India likely to store oil in US; signs MoU for operation, maintenance of strategic petroleum reserves

The centre looked to benefit from the decline in crude prices in March and April to fill India’s operational strategic petroleum reserve storage.

India on Friday entered into a memorandum of understanding with the US for cooperation on operation and maintenance of strategic petroleum reserves, The Indian Express reported. This would also include enhancing collaboration with respect to bio-energy, agri renewable energy and low emission coal technologies. As per the MoU signed at the US-India Strategic Energy Partnership meet, the two countries would also work towards exchange of information and best practices. Moreover, the possibility of India storing oil in the US Strategic Petroleum Reserve was discussed to boost the country’s strategic oil stockpile, according to a joint statement issued on Friday. The meeting, via video conferencing, was co-chaired by Oil Minister Dharmendra Pradhan with US Secretary of Energy Dan Brouillette.

The centre looked to benefit from the decline in crude prices in March and April to fill India’s operational strategic petroleum reserve storage. “Apart from fostering bilateral energy trade and investments, we are seeking to align energy cooperation with energy security, expand energy and innovation linkages across our respective energy sectors, facilitate increased industry and stakeholder engagement as well as institutions of excellence from both countries,” said Pradhan. The minister noted that the bilateral hydrocarbons trade hit $9.2 billion in 2019-20, contributing 10 per cent of the overall bilateral trade and significantly narrowing the India-US trade deficit.

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The decline in the international crude oil prices let India save thousands of crores of rupees by filling its strategic reserves at low cost. According to a tweet last month by Petroleum and Natural gas ministry, India was able to save Rs 5,000 crore in foreign exchange while strengthening its energy security by filling the strategic reserves to full capacity with cheap crude oil. India had entered into an MoU recently with the Saudi Aramco also for filling the cavern in Padur, the ministry had said.