Despite import dependence of about 85%, India's Strategic Petroleum Reserves remain below global standards. Critically examine.

India imports about 85% of its crude oil [1]. Yet its Strategic Petroleum Reserves (SPR), the underground rock caverns run by ISPRL, cover only about 9.5 days of demand [1]. The September 2026 West Asia price spike shows that this buffer is real but too thin.

Why the gap matters

• Concentration risk: most hydrocarbon imports come from the conflict-prone Middle East. Crude makes up about a quarter of merchandise imports [2].
• Price shock: the Indian crude basket rose from $82.0 to $116.1 a barrel between July and September 2026 [3]. Every barrel not stored now costs more.

Shortfalls: below global standards

• Capacity gap: the Standing Committee (2025) asked India to work towards 90 days of storage "as per global standards". Total national cover is about 74 days, most of it held by oil marketing companies [1].
• Caverns not full: only about 3.52 MMT of the 5.33 MMT Phase I capacity was filled as of March 2025 [1].
• Fiscal neglect: SPR capital spending for 2025-26 was cut from ₹5,876 crore to ₹870 crore [1]. Caverns were not filled when oil was cheap.
• Procurement exposure: the share of spot purchases rose from 27.6% to 35.1% between 2017-18 and 2022-23. This exposes more barrels to sudden price spikes [2].

Mitigating strengths

• Phase II: 6.5 MMT at Chandikhol (Odisha) and Padur (Karnataka), approved under a PPP model, which reduces the burden on the budget [4].
• Energy diplomacy: ADNOC (UAE) stores crude in the Mangalore SPR under an ISPRL MoU. The stock can be used in an emergency [5].
• Diversification: suppliers are spread across Russia, Iraq and Saudi Arabia. Parliament has also recommended pipelines and shorter routes [2].

Way forward

• A dedicated, non-lapsable fill fund that buys crude when prices fall [1].
• More term contracts to replace spot buying, after the audit the committee recommended [2].
• An expert group to cut fossil-fuel demand through electric vehicles, biofuels and green hydrogen [2].

India's SPR gap comes less from missing caverns than from empty caverns and erratic funding. The steps above are partly offsetting it. Filling existing capacity, finishing Phase II and steadily reducing oil intensity would move India towards the 90-day standard. That would turn energy security into a strategic asset and support SDG 7 (affordable, reliable energy).