Kpler data highlighted that the country has about 100 million barrels in strategic reserves – sufficient to cover about 45 days.

Despite dependence on oil imports, India does not feature in the list of leading countries with strategic petroleum reserves.

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Countries such as Japan, South Korea, and China, along with several European countries – Germany and France—have petroleum inventory that can easily stretch to about 90–100 days. China’s reserves can support requirements for about 130 days, while Japan’s stock can easily suffice for about eight months.

Beijing, the world's largest crude importer, has already started expanding inventory capacity to handle sudden supply strains.

China, according to Reuters, has already pressed the pedal on increasing capacity for reserve petroleum. The news agency noted that state oil companies “will add at least 169 million barrels of storage across 11 sites during 2025 and 2026.”

India’s Plans To Increase Oil Storage Facilities

India has embarked on an exercise to significantly expand storage capacity with three greenfield facilities in Odisha’s Chandikhole, Bikaner in Rajasthan, and Rajkot in Gujarat. Currently, there are only three storage facilities – all located in the Southern states: Andhra Pradesh, Karnataka, and Tamil Nadu.  

Government officials have said there is no cause for worry and that there is enough inventory to meet the country’s demand.

Iran supplies about 4–5% of global oil. What has caused concern is Tehran’s decision to block the Strait of Hormuz, the narrow yet most crucial strip of waterway for energy flows squeezed between Oman and Iran. The bulk of energy flows have been routed through this narrow strip.

For a country where 95% of trade by volume moves by sea, instability in West Asian waters is not distant geopolitics — it is a direct challenge to India’s economic security

– Shishir Priyadarshi, President, Chintan Research Foundation

Strait Of Hormuz

A prolonged closure of the Strait of Hormuz would impact logistics, and ships would have to be rerouted, affecting both transit time and cost. The increase in freight would push up insurance premiums, too.

“Sustained disruptions would keep crude prices elevated and tighten LNG availability, underscoring the need for strategic planning to protect India’s energy security,” Sehul Bhatt, Director at Crisil Intelligence (part of S&P Global), said in a statement.

Sources said that the government’s immediate push would ensure the timely completion of projects to support petroleum storage facilities.

Energy, Maritime Trade

“India’s growth story is based on imported energy and maritime trade; if either is shaken, the tremors will be felt from our economic growth to our development aspirations,” Priyadarshi said.

The bottomline: India needs to aggressively expand its petroleum inventory capacity. The Russia-Ukraine war, which followed the Covid pandemic, highlighted the importance of building oil storage facilities. 

Given India's dependence on oil imports, prioritising the expansion of strategic reserve facilities is essential for energy security.