India Cracks Down on Energy Security with Broader Strategic Reserves Strategy

India's energy security is under scrutiny as it aims to build strategic reserves to counter global supply disruptions. The country currently has 5.33 MMT of dedicated Strategic Petroleum Reserves capacity, equivalent to around 9.5 days of crude oil consumption.

The government has approved the Phase II expansion of 6.5 MMT at Chandikhol and Padur under the PPP model, which will increase the total strategic petroleum reserves capacity to 11.88 MMT once completed.

Experts recommend a broader energy security strategy that covers crude oil, LPG, and LNG. Pranav Master from Crisil Intelligence suggests a three-tier approach: large physical reserves for crude oil, distributed operational-security reserves for LPG, and virtual reserve model for LNG due to its high storage costs.

Sourav Mitra from Grant Thornton Bharat advocates for 30 days of dedicated strategic reserves managed by ISPRL, complemented by mandatory 60 days of commercial refiner operational stock. Sumit Ritolia from Kpler recommends targeting 75-100 days of total inventory cover, aligning with international best practices.