Editorial-19/05/2026
Unlearnt Lessons: On India’s Inadequate Strategic Petroleum and Gas Reserves
Introduction
India’s growing energy demand and heavy dependence on imported crude oil and natural gas have made energy security a major strategic concern. Recent geopolitical disruptions — including the Russia–Ukraine conflict, West Asian instability, Red Sea disruptions, and fluctuations in global oil prices — have once again exposed the vulnerability of energy-importing countries like India.
The editorial “Unlearnt Lessons” highlights how India has failed to adequately expand its Strategic Petroleum Reserves (SPR) and gas storage infrastructure despite repeated global energy crises. The issue is not merely economic; it directly affects national security, inflation management, industrial growth, and foreign policy autonomy.
What are Strategic Petroleum Reserves (SPR)?
Strategic Petroleum Reserves are emergency stockpiles of crude oil maintained by governments to ensure uninterrupted supply during crises such as:
- Wars and geopolitical conflicts
- Supply-chain disruptions
- Natural disasters
- Sudden price shocks
- Maritime blockades
These reserves act as a “national energy insurance”.
India’s SPR programme is managed by the Indian Strategic Petroleum Reserves Limited under the Ministry of Petroleum and Natural Gas.
India’s Current Strategic Reserve Capacity
India currently maintains underground crude oil storage facilities at:
- Visakhapatnam
- Mangaluru
- Padur
Additional facilities are planned at:
- Chandikhol
- Padur Phase-II
However, India’s total crude reserve capacity remains limited.
Present Status
- India stores crude oil equivalent to roughly 9–10 days of imports in SPRs.
- Combined with oil marketing company inventories, total coverage reaches around 70–75 days.
- This is significantly lower than the benchmark of many developed economies.
Comparison with Other Countries
| Country |
Approximate Strategic Reserve Coverage |
| United States |
~90–120 days |
| China |
~90 days+ |
| Japan |
~160 days |
| India |
~70 days combined stock |
This inadequacy becomes alarming considering India imports nearly 85% of its crude oil requirements and over 50% of natural gas needs.
Why Are Strategic Petroleum Reserves Important?
1. Energy Security
Energy is the backbone of:
- Transportation
- Industry
- Defence
- Agriculture
- Electricity generation
A disruption in imports can severely impact the economy.
2. Shield Against Geopolitical Crises
Conflicts in:
- West Asia
- Russia–Ukraine region
- Strait of Hormuz
- Red Sea routes
can interrupt global supply chains.
India imports a large share of oil from Gulf countries, making maritime security critical.
3. Inflation Management
Crude oil prices directly affect:
- Petrol and diesel prices
- Transportation costs
- Food inflation
- Fertilizer subsidies
Strategic reserves help stabilize domestic supply during global price spikes.
4. Strategic Autonomy
Countries with strong reserves can:
- Negotiate better international deals
- Avoid panic purchases
- Resist external pressure during crises
This enhances foreign policy independence.
5. National Security
Modern militaries depend heavily on uninterrupted fuel supplies.
In wartime or prolonged conflict, strategic reserves become critical national assets.
Why India’s Reserves Remain Inadequate
1. Delayed Policy Implementation
Despite recognizing vulnerabilities after:
- Gulf War (1991)
- Global oil shocks
- COVID-19 disruptions
India’s SPR expansion has been slow.
Projects often face:
- Land acquisition hurdles
- Funding shortages
- Bureaucratic delays
2. High Fiscal Costs
Creating underground storage caverns involves:
- Large capital expenditure
- Maintenance costs
- Crude procurement expenses
The government has often prioritized immediate fiscal pressures over long-term energy security.
3. Over-Reliance on Market Mechanisms
India traditionally relied on:
- Diversified imports
- Open global markets
- Commercial inventories
However, recent crises showed markets can fail during emergencies.
4. Inadequate Gas Storage Infrastructure
Unlike oil, India lacks significant strategic natural gas reserves.
This is problematic because gas usage is increasing in:
- Power generation
- City gas distribution
- Fertilizer production
- Industry
Liquefied Natural Gas (LNG) imports remain vulnerable to global price volatility.
5. Slow Transition Planning
India’s energy transition strategy has not adequately balanced:
- Renewable expansion
- Fossil fuel security
Even during green transitions, fossil fuels remain essential for decades.
Challenges in Expanding Strategic Reserves
Geological Constraints
Suitable underground rock caverns are geographically limited.
Financing Issues
Large-scale reserves require:
- Public investment
- Public-private partnerships
- Long-term procurement planning
Global Price Volatility
Buying oil during high-price periods becomes economically difficult.
Storage and Maintenance
Stored crude requires:
- Rotation
- Quality preservation
- Infrastructure management
Strategic Importance in Current Global Context
Recent global developments underline the urgency:
Russia–Ukraine Conflict
Sanctions and supply disruptions destabilized global energy markets.
Red Sea Crisis
Attacks on commercial shipping increased freight costs and disrupted oil transport routes.
OPEC+ Production Decisions
Production cuts by major oil producers impact importing nations like India.
China’s Energy Stockpiling
China has aggressively expanded reserves, enhancing its crisis resilience.
India risks strategic disadvantage without similar preparedness.
Government Measures Taken
Phase-I SPR Development
Operational reserves established at:
- Visakhapatnam
- Mangaluru
- Padur
Phase-II Expansion
New facilities proposed at:
- Chandikhol
- Additional Padur caverns
Diversification of Energy Imports
India has increased imports from:
- Russia
- United States
- Latin America
- Africa
to reduce dependence on West Asia.
Renewable Energy Push
India is expanding:
- Solar energy
- Green hydrogen
- Ethanol blending
- Electric mobility
to reduce fossil fuel dependence over time.
What More Should India Do?
1. Expand SPR Capacity Rapidly
India should target at least 90 days of strategic coverage, aligned with international norms.
2. Develop Strategic Gas Reserves
Dedicated underground gas storage systems are essential.
3. Encourage Public-Private Partnerships
Private sector participation can reduce fiscal burden.
4. Use Low-Price Opportunities
India should procure crude aggressively during global price collapses.
Example:
- COVID-era oil price crash
5. Integrate Energy Security into National Security Planning
Energy resilience must become part of:
- Defence strategy
- Foreign policy
- Economic planning
6. Accelerate Renewable Transition
Reducing fossil fuel dependence remains the ultimate long-term solution.
Key focus areas:
- Green hydrogen
- Battery storage
- Offshore wind
- Nuclear energy
Conclusion
India’s inadequate strategic petroleum and gas reserves reveal a serious gap in long-term national preparedness. Repeated global crises have demonstrated that energy security cannot be left entirely to volatile international markets.
As India aspires to become a major economic and geopolitical power, building robust strategic energy reserves is no longer optional — it is a strategic necessity. The lessons from past crises remain only partially learnt. Without urgent expansion of petroleum and gas storage capacities, India risks economic vulnerability and reduced strategic autonomy during future global disruptions.
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