* Japan gets around 90% of its oil from the Middle East

* Opened taps for a record oil stockpile release on

Monday

* Petrochemicals, steel, refineries and even sento baths

are hit

By Katya Golubkova and Mariko Katsumura

TOKYO, March 19 (Reuters) - Japanese companies, from

steel producers to chemical firms and even sento baths, are

feeling the heat from reduced Middle East energy supplies, even

as the government tapped stockpiles for a record oil release to

soften the blow.

Japan relies on the Middle East for around 90% of its oil

supplies, which mainly flow via the Strait of Hormuz, which is

effectively closed as a result of the U.S.-Israeli war on Iran.

JFE Steel, Japan's second-biggest steelmaker, on Thursday

shut down one of the five power generation facilities in

southwestern Hiroshima prefecture, due to the shortage of heavy

oil, a spokesperson said.

The spokesperson said steelmaking facilities at JFE, a unit

of JFE Holdings ( JFEEF ), are operating as usual.

The move adds to the growing number of businesses suffering

from the energy supply disruptions.

OIL CRUNCH MAY BOOST NUCLEAR

Petrochemical companies are cutting output amid fuel shortages

and rising costs, with Mitsubishi Chemical saying it

will raise prices by at least 70 yen ($0.4395) per kilogramme

from March 20 for products used in sectors from construction to

autos.

Refinery runs across Japan have fallen below 70% as of March 14

for the first time since last year, and the government rolled

out gasoline subsidies from Thursday to compensate for the

record spike in prices to more than 190 yen per litre.

Japan may seek to purchase oil from non-Gulf destinations,

including from the United States, and use more coal in its power

generation, according to officials.

"I think it will probably bring back the feeling that

nuclear power is important, once again," Ryosuke Tsugaru, senior

managing executive officer with JERA, Japan's top power

generator, told Reuters.

JERA itself does not have nuclear power plants but its

shareholder, Tokyo Electric Power Co ( TKECF ), last month

restarted its first reactor after the Fukushima Daiichi accident

in 2011.

As supplies become tighter, even Japan's popular snacks and

public baths - known as sento - are halting production, reducing

hours or shutting.

Katsuragi Onsen, a small sento in Aomori prefecture in

northern Japan, said on March 17 it will close at the end of

May.

"Due to the burden of fuel costs, we became unable to

maintain business operations," the notice, posted on X, said.

"Since the first opening in 1968, we have been supported by the

local community, and we would like to express our deepest

gratitude to everyone for their warm support."

As the Middle East crisis begins to hit end users, Japan's

household paper industry association issued a statement on

Wednesday saying nearly 100% of toilet paper in Japan is

produced domestically from locally sourced materials: "We ask

consumers for their understanding... and to remain calm."

($1 = 159.2700 yen)