Saudi Arabia Oil Storage Plan : Amid growing concerns about oil supplies in West Asia, Saudi Arabia is preparing to strengthen its arrangements for Asian markets. According to the information provided, Saudi Arabia is working on a plan to build crude oil reserves in Singapore from the second half of 2027. The aim is to create more options for delivering oil quickly to Asian countries if maritime supply routes are disrupted. The plan could also be important for India, which imports a large share of its crude oil requirements.

Oil to Be Stored in Jurong Rock Caverns
Under the proposed plan, Saudi Arabia could store crude oil at Singapore’s Jurong Rock Caverns. This underground storage facility is located approximately 150 metres beneath Jurong Island. It reportedly has a total storage capacity of around 1.47 million cubic metres for crude oil, condensate and other liquid hydrocarbons. Storing oil closer to Asian markets could help manage supplies when needed. However, the actual benefits will depend on how the oil is withdrawn from storage and delivered to buyers.

Agreement Planned Between Aramco and Singapore
Singapore’s Minister for Energy, Trade and Industry, Tan See Leng, shared information about the plan during Singapore International Energy Week. Under the proposed arrangement, Saudi Arabia’s state-owned oil company, Saudi Aramco, is expected to work on a memorandum of understanding with Singapore’s Energy Market Authority and JTC Corporation. According to the available information, discussions on the agreement are expected to move forward. The arrangement could also be important for Singapore by strengthening regional oil storage and supply management. Saudi Arabia aims to make oil available closer to its Asian customers and create a more flexible supply network.

Why India’s Oil Requirements Could Be Affected
India meets a large proportion of its crude oil demand through imports. Conflict in West Asia or disruptions to supplies passing through the Strait of Hormuz could push up international oil prices. This could affect India’s import bill, the value of the rupee and domestic inflation. Additional storage in Singapore could expand the options for supplying oil across Asia. However, this does not guarantee that India will receive oil directly from these reserves or at lower prices. Separate commercial agreements and supply arrangements would be required.

Saudi Arabia Also Stores Oil in Japan and South Korea
Saudi Arabia has already been involved in oil storage arrangements in Japan and South Korea. Such arrangements are intended to help maintain oil availability when unexpected supply disruptions occur. An agreement has also been established for storing Saudi oil in Okinawa, Japan. The proposed Singapore arrangement could form part of this broader strategy, through which Saudi Arabia is expanding options to keep oil available closer to its major Asian markets. For India, the actual benefits will depend on future oil availability, prices and commercial agreements.