India Commissions ONGC to Build 12.8 Million Barrel Strategic Oil Reserve

The project intends to add roughly 12.8 million barrels to India’s existing 39-million-barrel reserve, which currently provides only eight days of coverage for national demand. Managed by Indian Strategic Petroleum Reserves Ltd, the current infrastructure is centered in the country's south. ONGC is expected to petition the government for permission to utilize the new facility commercially, potentially offsetting the high capital expenditure required for the build-out.

Energy security has climbed the political agenda in New Delhi following supply crunches that triggered sharp fuel price hikes and domestic inflation. Beyond the ONGC facility, the government is pursuing two additional storage projects with a combined capacity of approximately 47.3 million barrels. International partnerships remain a central component of this strategy; Prime Minister Narendra Modi is actively negotiating with the UAE to expand foreign inventory holdings in India to 30 million barrels, while simultaneously exploring reciprocal storage options at the port of Fujairah to bypass the logistical risks associated with the Strait of Hormuz.