Asia Stockpiles Oil at Home as Hormuz Chokes
Asia Stockpiles Oil at Home as Hormuz Chokes
The News
Asia's biggest energy importers are building oil and gas storage closer to home to cut their exposure to the Strait of Hormuz, six months after the United States and Israel went to war with Iran and shipping through the strait was reduced to a trickle by Iranian attacks and a US naval blockade.
Japan, India, South Korea, Thailand and the Philippines are all expanding or creating strategic stockpiles, Al Jazeera reported Thursday.
Gulf producers are improvising too: Qatar and the United Arab Emirates moved three LNG cargoes onto other ships outside the strait last month, a maneuver Reuters described as highly unusual for LNG.
Timeline
The Iran war breaks out. Asian governments impose fuel conservation measures — price caps, alternate driving days and work-from-home mandates for civil servants — as oil and gas prices surge. Vietnam's national reserves hold only five to seven days of oil, according to state media, with commercial inventories stretching supplies up to another 65 days.
Thailand holds about 61 days of reserves across the public and private sectors against a 25-day mandated minimum. The Philippines is estimated to have 50-60 days in private commercial inventories. All are below the International Energy Agency's 90-day benchmark.
Japanese Prime Minister Sanae Takaichi announces the $10 billion POWERR Asia initiative to help Southeast Asian economies buy oil and petroleum products and, over time, build strategic stockpiles.
India holds about 74 days of oil stocks, more than 90 percent of it with state-owned firms, according to S&P Global. China's state pipeline operator PipeChina says it is accelerating work on some of its nearly 40 oil and gas projects, including 9,000 kilometers (5,590 miles) of domestic pipeline.
The Qatar-owned LNG carrier Al Rekayyat is hit by a projectile near the Strait of Hormuz.
India's state-owned Oil and Natural Gas Corporation says it will build a 1.75 million metric tonne reserve — about 13 million barrels — in the country's south, on top of plans to expand existing stockpiles by 6.5 million tonnes. The Greek-owned GasLog Shanghai is involved in an "incident" in the strait at the end of the month.
Three LNG cargoes are transferred ship-to-ship outside the strait, according to vessel-tracking data from Vortexa and Kpler cited by Reuters. Al Rekayyat transfers to the Tembek in mid-August; ADNOC's Mraweh transfers to LNG Enugu offshore Oman; GasLog Shanghai transfers to GasLog Savannah offshore Oman in late August. A parliamentary panel in the Philippines approves a bill creating a 60-day government-held reserve.
The Tembek's cargo is delivered to India. The Mraweh's cargo is en route to Japan.
Reactions
"The crisis is producing two very different kinds of investment: infrastructure that bypasses geopolitical risk, and infrastructure that eliminates exposure to imported fuel altogether," said Parul Bakshi, a visiting research fellow at the Oxford Institute for Energy Studies.
Bakshi said the common thread is reducing exposure to a "single fuel, supplier or chokepoint." He added: "It is no longer enough to ask where the next barrel comes from. We also have to ask how it gets there, how long we can operate without it, and whether we can reduce our need for that barrel altogether."
Clara Gillispie, a senior fellow for climate and energy at the Council on Foreign Relations, said Japan, South Korea and Singapore have longstanding partnerships with Middle Eastern countries to hold supplies closer to their shores, and that "for each of those three, we've heard some interest in expanding the existing capacity, as well as potentially signing new understandings." She said there have also been conversations about expanded arrangements with India.
David Fishman, a Chinese energy policy expert at the Hong Kong-based Lantau Group, said Beijing's 2026-2030 five-year plan for oil and gas — drafted before the war — already called for more pipelines and expanded LNG storage, and the conflict has hardened the case for it. "Whatever internal uncertainty there might have been around the costs or effort associated with building up potentially superfluous national energy reserves will certainly have evaporated," Fishman said.
Ben Kiatkwankul of Bangkok-based Maverick Consulting Group said Thai officials are pushing "cross-peninsula crude pipelines and tank farms, positioning Thailand against Singapore for Gulf crude storage."
What's Next
LNG traffic through the Strait of Hormuz remains at a standstill even as oil flows are estimated to have rebounded in recent weeks, and Qatar's force majeure on deliveries is still in place. That, combined with US-Iran re-escalation, pushed Asian spot LNG prices to a five-month high and Europe's benchmark gas price to a three-and-a-half-year high this week.
Watch for the Philippine reserve bill to move beyond committee, for South Korea to decide on expanding its roughly 146 million barrels of reserves by an additional 30-40 million barrels — up from an initial plan for 20 million — and for New Delhi to rule on a proposal to park part of its strategic reserve at the UAE port of Fujairah, on the Gulf of Oman side of the chokepoint.
More
Abu Dhabi National Oil Company already stores oil in Singapore, India, South Korea and Japan, and Kuwait and Saudi Arabia hold stockpiles in South Korea and Japan, according to the Observer Research Foundation, a New Delhi think tank. ADNOC is aiming to lift its crude storage capacity in India to 30 million barrels.
Why it matters to Americans: China is the world's second-biggest oil consumer after the United States, and the storage buildout across Asia is a bet that the Hormuz disruption is not a passing shock but a permanent feature of the market — which keeps a floor under global fuel prices.
Four Killed in Louisiana Stabbing; Manhunt Underway
Colleges Condemn Students Mocking Kirk Assassination Anniversary
Sep 13, 2026
Charleston White Arrested Again on Florida Battery Charge
Sep 13, 2026
Border Patrol Rescues MS NOW Crew in Desert
Sep 13, 2026
Supreme Court Restores Missouri's Old House Map
Sep 13, 2026
Alaska Drops Felony Voter Charges Against Samoans
Sep 13, 2026
Trespasser Breaches Harris' Malibu Estate; No Arrest
Sep 12, 2026
Hegseth Pressed Downed Airmen Into 60 Minutes
Sep 12, 2026
Houthis Seize Mokha, Choking Saudi Oil Exports
Sep 12, 2026
Altman Rules Out OpenAI IPO This Year
Sep 12, 2026
Jury Acquits Lil Durk in Murder-for-Hire Case
Sep 12, 2026
Judge: Trump Broke Law Halving FEMA Staff
Sep 12, 2026
Maher Calls Democrats' Gaza Genocide Claim a Lie
Sep 12, 2026
Blizzard Revives StarCraft, Sends Diablo to Netflix
Sep 12, 2026
Trump's Queens Childhood Home Sells for $1.93M
Sep 12, 2026
Scientists Find New Virus in Tick Invading US
Sep 12, 2026
Britain Bans Settlement Imports; US States Threaten Payback
Sep 12, 2026
Prison Fire Kills 7 as Kurds Protest Killing
Sep 12, 2026
Kosovo Rallies for Ex-President Before Hague Verdict
Sep 12, 2026
Cruz Booed at GameDay Over College Sports Bill
Sep 12, 2026
Sep 13, 2026