Why the Next Billion Barrels of Oil Demand Could Come From Storage

AI Summary

The closure of the Strait of Hormuz disrupted over 10 million barrels per day of crude oil supply, prompting countries, notably in the Asia Pacific, to expand strategic oil storage capacity. This move aims to enhance energy security and mitigate risks from future supply chokepoints.

The closure of the Strait of Hormuz and the stranding of more than 10 million barrels per day (bpd) of crude oil in the Persian Gulf was a wake-up call for import-dependent countries to expand their capacity to hold strategic and commercial reserves. Many countries, especially in the Asia Pacific, are looking to build new reserve capacity to boost their energy security and never again be caught off-guard by a massive supply disruption like the one triggered by the closure of the most important oil and LNG chokepoint. From India to Australia, energy…