Even as India gets ready to commission its first strategic oil storage facility in January, it currently has the lowest cover for crude oil among developing economies including China and Japan, government data showed on Thursday.
Building strategic crude oil reserves is considered a must since these stocks provide an insurance against any oil supply disruptions to economies that are heavily dependent on oil imports such as India.
Most developing nations are maintaining low crude oil inventory compared to developed nations such as the US that is maintaining a cover of 56 days, the report said.
While China has a 26 days cover, Japan has 25 days of crude oil inventory, while India is the lowest at 20 days.
India’s public sector units and joint venture refineries are expected to import around 777 million barrels of crude oil in 2013-14.
“Considering the current inventory levels, the existing crude oil stock will provide a 20-day cover,” a senior government official said.
The refinery throughput of China stood at 9,371 kilo barrels per day in 2012 according to latest estimates and its crude stock build is around 665,000 barrels per day. This is equivalent to an inventory level of around 2,42,725 kilo barrels and provides a 26-day cover.
In contrast, the refinery throughput of Japan is 3,400 kilo barrels per day for 2012. Japan’s crude oil inventory is 85,790 kilo barrels which has a 25-day cover.
In contrast, the US has the maximum strategic reserves compared to most nations. With a refinery throughput of 15,006 kilo barrels per day, the US’ crude oil inventory stood at 10,55,962 kilo barrels as on September 6, 2013.