Saudi Arabia to Build Oil Reserves in Singapore to Secure Energy Supplies

Darwin, October 27: Saudi Arabia plans to store crude oil at Singapore’s Jurong Rock Caverns to strengthen the security of energy supplies across Asia. The two countries’ energy ministers announced that the storage arrangements are expected to begin in the second half of 2027, Reuters reported.

The initiative comes after the US-Israeli war involving Iran severely disrupted energy supplies to Asia through the Strait of Hormuz. Supply shortages have forced several countries to draw on their oil reserves, raising global concerns about the adequacy of strategic stockpiles. Before the war, the Middle East accounted for two-thirds of Asia’s imported oil.

Singapore’s Minister for Energy, Trade and Industry, Tan See Leng, announced the plan on Monday at the Singapore International Energy Week conference.

“Saudi Arabia and Singapore are jointly announcing our interest in establishing arrangements for Saudi crude oil storage at the Jurong Rock Caverns from the second half of 2027,” he said.

Tan said the arrangement would make Saudi crude oil supplies to Southeast Asia more resilient. It would also strengthen Singapore’s energy security and improve its ability to respond to supply disruptions.

He added that Saudi Aramco would sign a memorandum of understanding with Singapore’s Energy Market Authority and JTC Corporation on Monday. The parties aim to finalise discussions on the arrangements within the next few months.

In a video message to the conference, Saudi Energy Minister Prince Abdulaziz bin Salman Al Saud said, “Positioning oil supplies closer to key markets in Asia will enhance the flexibility of our supply network. It will also strengthen Singapore’s security of supply and preparedness for emergencies.”

Oil Storage Facility 150 Metres Underground

The Jurong Rock Caverns, located approximately 150 metres underground on Singapore’s Jurong Island, can store liquid hydrocarbons, including crude oil and condensate.

The underground facility has a total storage capacity of up to 1.47 million cubic metres, equivalent to approximately nine million barrels of oil.

Saudi Aramco currently maintains crude oil storage facilities in Japan and South Korea. In the event of an unexpected energy crisis, the governments of those countries receive priority access to purchase oil from the reserves.

Source: Reuters