India allocates $647 mn for strategic oil reserves

India has allocated 55.97 billion rupees ($646.78 million) to purchase oil for its strategic petroleum reserves (SPRs) for the fiscal years 2025-26, amid global supply uncertainties. The Indian Strategic Petroleum Reserve Ltd (ISPRL), which manages the federal oil inventories, currently operates three SPRs in southern India with a combined capacity of approximately 5 million tons. A portion of this capacity is utilized for commercial operations by companies such as Abu Dhabi National Oil Co (ADNOC).

Besides oil purchase, the budget includes 1.8 billion rupees for the operation and maintenance of the SPRs and 3.35 billion rupees for the purchase of land and construction of new storage caverns. These investments are part of India’s broader strategy to expand its SPR capacity, given that the country imports over 80% of its oil needs and is the world’s third-largest oil importer and consumer.

ISPRL has has sought interest from private companies in building and operating a 2.5 million metric ton storage facility for petroleum reserves at Padur in the southern state of Karnataka. Furthermore, India is planning to construct a 4-million-ton SPR at Chandikhol in the eastern state of Odisha.