The Association of Southeast Asian Nations (ASEAN) is gearing up for a coordinated oil stockpiling plan which may be launched as early as 2027, enhancing energy security in the region.
The ASEAN Oil Reserve system would enable the participating countries to utilize stored petroleum products in times of oil supply emergency.
A November 12 Reuters report quoted Nikkei as saying that the first storage facilities will be in Indonesia and Thailand, with the Philippines being one of the first to benefit.
ASEAN Oil Reserve Initiative Targets 2027 Launch
The draft plan would temporarily enable the Philippines to import emergency supplies of diesel and gasoline from Indonesia and Thailand. As for the Philippine National Oil Company (PNOC), companies’ letters of intent with storage operators are expected to be signed on November 14.
How the Regional Oil Stockpiling System Will Work
The proposal suggests a ticketing system in which if the governments or companies are willing to participate, they would pay an advance payment to use a specific amount of fuel in emergencies. Led by the Economic Research Institute for ASEAN and East Asia in cooperation with industry partners to come up with marketable storage solutions.
Why ASEAN Needs Stronger Regional Energy Security
The disruptions in supply due to the Middle East conflicts have highlighted the reliance of Southeast Asian supply on the world oil markets. Participating economies could have access to emergency reserves to cope with temporary shortages and shipping interruptions. The Philippine Presidential Communications Office earlier noted that the fuel sharing scheme is a preventive measure against future crises.
Japan Supports ASEAN Oil Stockpiling Expansion
Japan is supporting the initiative to increase the energy resilience of Southeast Asian countries. The cooperation is likely to be announced by Prime Minister Sanae Takaichi on Nov. 17 during the Asia Zero Emission Community summit in Manila. There is growing interest in expanding to Laos and Timor-Leste and potentially other regional countries.
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