Last summer, West Texas Intermediate (WTI), a grade of crude oil used as a benchmark in oil pricing, stood at more than $100 per barrel. At one point after the turn of the year, it plunged below $50. Consumers have benefited from the steep fall in crude oil prices as prices of oil-related products have dropped as well. But lower oil prices can also lead to international economic instability that would impact Japan. Rather than use the drop in oil prices as an excuse to postpone diversification of Japan's energy portfolio, the government must pursue an energy policy that will shield the nation from fluctuations in oil prices over the long term.

The Japanese economy benefits from lower oil prices. The cost of thermal power generation — on which the nation has relied heavily since the nuclear power plants were shut down after the 2011 Fukushima disaster — will go down, putting a brake on the rise in electricity charges. Domestic gasoline prices have fallen for 26 straight weeks. As of Jan. 19, the nationwide average price of regular gasoline had come down to ¥139.6 per liter — falling below ¥140 for the first time in 29 months. The corresponding price of kerosene had dropped to ¥86.7 — ¥2.6 cheaper than in the previous week.

Cheaper fuel costs will reduce the financial burden on farmers and fishermen. Manufacturing industries can also expect lower costs thanks to drops in the prices of such intermediate goods as plastics and synthetic rubber. All these factors will push down overall prices, possibly contributing to a recovery in consumer spending.