India to fill Strategic Oil Reservers by Itself
Economic Times, Delhi   10-Apr-2020

India has finally decided to fill up its half-empty strategic petroleum reserve with its own money, ending an effort to convince Saudi Arabia and the UAE to store their oil in national caverns, according to people familiar with the matter.

The government has directed state refiners to place their excess crude supplies in these caverns for which they will be reimbursed, they said.

Indian Oil, MRPL, Bharat Petroleum and Hindustan Petroleum will together supply about 2.5 million tonnes of oil they are already purchasing from multiple suppliers but can't process in their refineries due to dramatic demand destruction during the lockdown. Of the total, 40% will come from Indian Oil, a third from MRPL, a quarter from BPCL and a small quantity from HPCL over April and May, sources said, adding that the government will reimburse refiners their purchase cost.

"This helps on two fronts: as a country, we get cheap oil quickly for our caverns while helping resolve the storage problem for refiners," said the person with direct knowledge of the matter. Several refineries are currently functioning at about 50-60% of their nameplate capacity and have little place left to store their crude supplies or refined products. This has prompted many of them to issue force majeure notices and refuse much supplies meant for April.