Saudi Arabia plans to store crude oil in Singapore’s Jurong Rock Caverns from the second half of 2027 to strengthen regional supply security and enhance the resilience of its crude oil supply chain, according to statements by the two countries’ energy ministers on October 26, Reuters reported.

The planned arrangement comes amid disruptions to energy supplies to Asia following the US-Israeli war with Iran, which affected oil shipments through the Strait of Hormuz, prompting countries to draw down inventories and raising concerns over global stockpile levels. Before the conflict, Asia sourced around two-thirds of its oil imports from the Middle East.

Saudi Aramco is expected to sign a memorandum of understanding (MoU) with Singapore’s Energy Market Authority (EMA) and JTC Corporation on October 26, with negotiations targeted for completion within a few months, Singapore’s Minister for Energy, Trade and Industry Tan See Leng announced at the Singapore International Energy Week conference.

The arrangement aims to bring Saudi crude supplies closer to key Asian markets, improving supply flexibility while supporting Singapore’s energy security and preparedness for potential disruptions, Saudi Energy Minister Prince Abdulaziz bin Salman Al-Saud said.

Located approximately 150 meters underground on Jurong Island, the Jurong Rock Caverns can store up to 1.47 million cubic meters of liquid hydrocarbons, equivalent to around nine million barrels of crude oil and condensate.

Saudi Aramco also maintains crude oil storage arrangements in Japan and South Korea, where local governments have priority access to the stored supplies in the event of unexpected shortages. In Japan, Aramco Japan expanded storage capacity in Okinawa to 8.2 million barrels (mmbbl) in September 2017 under an agreement with the Japan Oil, Gas and Metals National Corporation (JOGMEC).