# Japan's $21 Billion US Gas Deal Spree Contrasts With Losses at China's Big Airlines as Iran-War Fuel Costs Spread Across Asia

Jet fuel prices have more than doubled since late February, and the airlines and buyers that cannot hedge the cost are absorbing it while Japan buys gas fields in Texas and Louisiana.

- Published: 2026-11-02T05:15:08.429Z
- Canonical: https://polylog.news/2026-11-02/japan-s-21-billion-us-gas-deal-spree-contrasts-with-losses-a
- Publisher: Polylog (Global desk)
- Section: markets
- Sources: [Financial Times World](https://www.ft.com/content/9652cb30-c8b1-4f36-993f-54f7827d2174?syn-25a6b1a6=1), [The Japan Times](https://www.japantimes.co.jp/business/2026/11/02/companies/china-airlines-losses-fuel-costs/), [Antara](https://en.antaranews.com/news/439399/garuda-indonesia-groups-transformation-programme-drives-132-revenue-growth-to-us271-billion-amid-high-jet-fuel-prices)

Japanese companies have spent about [$21 billion buying gas supplies](https://www.ft.com/content/9652cb30-c8b1-4f36-993f-54f7827d2174?syn-25a6b1a6=1), the Financial Times reported. Japan is the world's second-largest buyer of liquefied natural gas (LNG), and its companies are buying shale gas assets near the US Gulf Coast. The largest deal is Mitsubishi's [$7.53 billion acquisition, including debt](https://www.cnbc.com/2026/01/16/mitsubishi-shale-gas-assets-texas-louisiana-deal.html), of Aethon's assets in Texas and Louisiana. JERA, Japan's largest power generator, committed [$1.5 billion to the Haynesville Shale in October](https://biztoc.com/x/d8c143ac1ea66af5). Owning the gas wells gives the buyers a physical hedge on LNG contracts priced against the Henry Hub benchmark, the main US price reference for natural gas, [Argus](https://www.argusmedia.com/en/news-and-insights/latest-market-news/2781706-japanese-firms-add-flexibility-with-us-gas-footprint) has reported.

Companies that cannot hedge are taking losses. [The Japan Times](https://www.japantimes.co.jp/business/2026/11/02/companies/china-airlines-losses-fuel-costs/) reported that China's three largest airlines are on track to post full-year losses because the price of jet fuel has more than doubled since the United States and Israel began their military campaign against Iran in late February.

Some carriers are managing better. Indonesia's state agency [Antara](https://en.antaranews.com/news/439399/garuda-indonesia-groups-transformation-programme-drives-132-revenue-growth-to-us271-billion-amid-high-jet-fuel-prices) reported that the Garuda Indonesia group raised revenue 13.2% from a year earlier, to $2.71 billion, despite high jet fuel prices. The company credited its restructuring program. Revenue growth does not show whether margins held.

## What this means

Gulf supply risk is redistributing income across Asia. Buyers with capital and US political access, such as Japanese trading houses and utilities, are paying a premium now to own natural gas assets in North America, outside the Strait of Hormuz. That shifts their exposure from Gulf shipping risk to Henry Hub pricing and US export policy. Chinese carriers buy fuel at spot prices and pass costs on slowly to price-sensitive domestic travelers, so they absorb the loss directly. US gas producers gain an asset bid and long-term offtake agreements, contracts that lock in future purchases, and Gulf exporters lose some of their share of future Asian contracts. After the 2011 Fukushima disaster, Japanese utilities signed long-term LNG contracts that shaped their supply for a decade. These deals are a similar long-horizon commitment. The desk's forward read: expect more Japanese and South Korean upstream purchases in the United States over the next year even if Hormuz reopens, because the deals respond to repeated disruption, not to a single closure. If the strait reopens and jet fuel prices fall, Chinese airline losses should shrink within two quarters. A US move to restrict LNG exports would weaken the Japanese strategy.

## What to watch

- Further Japanese or South Korean acquisitions in the Haynesville Shale. More deals would confirm that Asian buyers are reducing Gulf dependence for the long term.
- Jet fuel crack spreads, the margin refiners earn turning crude oil into jet fuel, in Singapore. A narrowing after any Hormuz reopening would show how quickly airline costs can fall.
- Whether Beijing offers fuel subsidies or capital to its state airlines. It would show the cost of the war being moved onto China's public accounts.