ISLAMABAD: The government should develop strategic oil and gas storage on priority basis to protect the country from crisis, emergencies and supply chain disruptions and keep price volatility in check.

The need for strategic storage was established as per the Oil and Gas Regulatory Authority (Ogra) Ordinance 2002 and the Ministry of Energy (Petroleum Division). As per an Ogra study in 2022, it was strongly recommended to establish strategic oil and gas storage.

The idea for storing oil and gas came in a research study prepared jointly by Islamabad Policy Research Institute (IPRI) and Petroleum Institute of Pakistan (PIP) and launched on Tuesday.

The study titled, ‘Pakistan’s Energy Sector: Need for Strategic and Commercial Storages (Oil & Gas)’ says that Pakistan being an import dependent country for its oil and gas needs is doubly vulnerable to supply chain disruptions and emergencies like wars and naval blockades and, therefore, needs to develop strategic reserves’ storage capacity as a national security as well as energy resilience imperative.

The present Israel-Iran war is a stark reminder of the need for commercial buffer stocks. Pakistan’s Federal War Book also mandates 45-day strategic reserves - an aspect emphasised by Joint Staff Headquarters.

The IPRI-PIP study recommends the development of oil and gas strategic reserves as per the Federal War Book by constructing well dispersed storage along with upgradation and construction of more oil refineries, and laying a renewed network of pipeline dissemination for upcountry.

India holds a strategic crude oil reserve of 22 days and, combined with 65 days of strategic reserves in refineries, holds a cumulative reserve of 87 days. It, however, holds no strategic gas reserves.

The event was attended was a wide segment of oil and gas and energy experts, besides the think tank community and academics related to the field.

President IPRI Lt General Majid Ehsan (retd) spoke about the importance of strategic storages in his opening address. The policy prescriptions provide a roadmap for the policy planners, as well as the private sector, to adopt a symbiotic approach to plan the strategic storages in collaboration with the relevant stakeholders in security and governance domains.

CEO Petroleum Institute of Pakistan, Shehryar Khan, and the Executive Director of OGDCL, Amir Saleem. Former foreign minister and Ambassador Inam ul Haq summed up the discourse by emphasising the need for strategic Oil & Gas storage as a national security imperative, especially in present era of geo-political uncertainties where smooth logistical flow and undisturbed supply chains are becoming difficult undertakings.

Published in Dawn, June 19th, 2025