Philippines discusses oil storage with Saudi Arabia — Asharq Al-Awsat

The Philippines is negotiating with Saudi Arabia and the United States on storing oil in the country. Authorities seek to protect themselves from sharp fluctuations in fuel prices amid the war around Iran, Asharq Al-Awsat reports, citing Energy Secretary Sharon Garin.

Negotiations on reserves

According to Garin, Manila is also discussing oil storage with Japan, Kuwait, the United Arab Emirates and Australia. The Philippines, which imports nearly all of its required energy resources, seeks to build up reserves after U.S. and Israeli strikes on Iran in February disrupted supplies.

Saudi Arabia this week announced a preliminary agreement to store its oil in Singapore's underground storage facilities starting in 2027. The Philippines is simultaneously working with Tokyo to establish regional oil reserves that are intended to supplement national stocks.

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Storage facility in Bataan and El Niño risks

In 2027, the Philippines plans to build its first state-owned tank for strategic oil reserves in Bataan. The country currently has fuel stocks for 55 days, compared with a minimum requirement of 15 days. Private storage facilities hold 1 million barrels of oil.

The government plans to gradually increase strategic reserves to a level sufficient for 60 days, dividing them equally between crude oil and petroleum products. Average daily consumption of petroleum products in the Philippines in May amounted to about 78 million liters, or approximately 490,600 barrels.

Garin also said that in the first half of 2027, due to the El Niño phenomenon, hydropower generation in the country could decline by about 60%, while solar generation could fall by 20%. To offset the shortfall, the Philippines intends to increase electricity generation at diesel and gas-fired plants.