Dharmendra Pradhan oil minister said, India is looking at storing some low priced U.S. oil in facilities there as its local storage is full. India's plan could be identical to a move by Australia, which last month said it would build up an emergency oil stockpile at first by buying crude to store in the U.S. Strategic Petroleum Reserve to take benefits of low oil prices.
"We are exploring some possibility if we can store some of our investment in a different country, we are exploring the possibility in the USA if we can store some of the low priced oil," Pradhan said.
Oil prices have so far declined by more than 40 percent in 2020 but have risen in the last few weeks, partially as a result of attempts by the Organization of Petroleum Exporting Countries and allies to curb supply.
Pradhan said that India, the world's third-largest oil consumer, and importer, had already filled 5,33 million tonnes of strategic storage and parked about 8,5 - 9 million tonnes of oil on ships in various parts of the world, mainly in the Gulf.
Indian refiners have loaded their commercial tanks and pipelines with refined fuel and oil.
Pradhan said that stored oil and products accounted for around 20 percent of India’s annual needs. India imports more than 80 percent of its oil requirements.
India plans to construct additional strategic storage space by 6.5 million tonnes. Pradhan said India was eager to have the involvement of foreign investors in the development of such facilities. India’s fuel demand almost halved in April to its lowest point since 2007 as a national lockdown and travel restraint to combat the spread of novel coronavirus eroded economic activity.
So far, India’s demand for petrol and diesel in May is around 60 percent-65 percent of what it was during the same month last year, and its fuel consumption in June would rise to the same amount as in June 2019, he added.