Bharat’s decision to build a new Strategic Petroleum Reserve through ONGC is far more than an infrastructure project. It reflects a fundamental shift in the country’s national security doctrine. Energy resilience, supply chain security, and strategic preparedness are now becoming as vital as military capability in an increasingly volatile geopolitical environment. 

By Sanjeev Oak

In a significant policy decision, the Government of Bharat has directed the Oil and Natural Gas Corporation (ONGC) to develop a new Strategic Petroleum Reserve (SPR) at Mangaluru in Karnataka. The underground cavern will have a storage capacity of 1.75 million metric tonnes, or approximately 12.8 million barrels of crude oil. The project is expected to require an investment of nearly ₹15,000 crore.

The project represents far more than an expansion of Bharat’s emergency oil storage capacity. For the first time, a Strategic Petroleum Reserve is being developed through ONGC rather than directly by Indian Strategic Petroleum Reserves Limited (ISPRL). This marks an important evolution in the country’s approach to strategic infrastructure. Since ONGC already owns the required land, construction is expected to progress considerably faster than previous reserve projects.

More importantly, the decision demonstrates that Bharat’s energy security strategy is evolving beyond government-led infrastructure development. Public-sector energy companies are now becoming active partners in strengthening the country’s long-term strategic resilience.

“Energy security is no longer an economic issue. It has become a pillar of national security.”

The Strait of Hormuz Lesson

The timing of this decision is no coincidence.

The recent military confrontation involving Iran and Israel once again exposed the vulnerability of global energy supply chains. Although the Strait of Hormuz remained open, even the possibility of disruption sent shockwaves through international energy markets. Nearly one-fifth of the world’s traded crude oil passes through this narrow maritime corridor, making it one of the most strategically important maritime chokepoints in the global economy.

For decades, the Strait of Hormuz has remained one of the world’s most consequential geopolitical flashpoints. Any disruption there can rapidly affect global oil prices, shipping costs, insurance premiums, inflation, and financial markets. The recent crisis once again demonstrated that energy security can never be separated from geopolitical stability.

For Bharat, the stakes are particularly high. The country imports nearly 90 percent of its crude oil requirements, with a substantial share sourced from the Gulf region. Any prolonged disruption in the Strait of Hormuz would sharply increase the country’s import bill, fuel domestic inflation, widen the current account deficit, and slow economic growth.

The episode also highlighted a broader reality. Modern economies are no longer threatened solely by military conflict. They are equally vulnerable to disruptions in maritime trade routes, energy supplies, and critical infrastructure. In today’s geopolitical landscape, an oil tanker can be just as strategically significant as an aircraft carrier.

The decision to expand Bharat’s Strategic Petroleum Reserve is therefore not merely a response to one regional crisis. It reflects a recognition that geopolitical disruptions are no longer exceptional events. They are becoming a recurring feature of the international system.

“The Strait of Hormuz reminded Bharat that supply chains can become battlefields.”

Background: Why Strategic Petroleum Reserves Matter

Strategic Petroleum Reserves are not designed to eliminate crises. Their primary purpose is to provide governments with valuable time to stabilise domestic markets, secure alternative supplies, reassure investors, and prevent temporary disruptions from escalating into national emergencies.

Bharat currently maintains Strategic Petroleum Reserves at Visakhapatnam, Mangaluru, and Padur, with a combined storage capacity of approximately 5.33 million metric tonnes. These reserves provide an important strategic cushion, but they cover only a limited period of national crude oil consumption. As Bharat’s economy continues to expand and energy demand rises steadily, increasing strategic storage capacity has become both an economic necessity and a national security imperative.

The new Mangaluru reserve will increase Bharat’s Strategic Petroleum Reserve capacity by nearly one-third. It will significantly strengthen the country’s ability to absorb temporary disruptions in global energy supplies while protecting the domestic economy from immediate shocks.

“Strategic petroleum reserves do not prevent crises. They give nations the time needed to manage them.”

Why ONGC? A Fundamental Policy Shift

Perhaps the most significant aspect of this project is not its storage capacity, but what it reveals about Bharat’s evolving approach to strategic governance.

Until now, Bharat’s Strategic Petroleum Reserves were developed by Indian Strategic Petroleum Reserves Limited (ISPRL), a government-owned entity financed directly through public expenditure. The new Mangaluru project represents a significant departure from that model. Instead of relying exclusively on budgetary allocations, the government has directed ONGC to finance and execute the project through its own balance sheet.

This reflects an important evolution in Bharat’s strategic governance. Rather than treating energy security solely as a government responsibility, New Delhi is increasingly leveraging the financial strength, technical expertise, and operational capabilities of national energy companies to build critical strategic infrastructure. It is a more integrated model in which state-owned enterprises become active contributors to national resilience.

The decision also demonstrates fiscal prudence. By utilising ONGC’s financial capacity, the government can accelerate strategic infrastructure without placing an immediate burden on the national exchequer. At a time when defence modernisation, infrastructure expansion, social welfare, and capital investment all compete for public resources, this approach strengthens national preparedness while maintaining fiscal discipline.

Equally important, ONGC already owns the required land at Mangaluru. This eliminates one of the biggest obstacles that frequently delays large infrastructure projects. The absence of land acquisition challenges is expected to shorten the execution timeline considerably and enable the reserve to become operational much sooner.

The Mangaluru project could become a template for future strategic infrastructure initiatives, with financially strong public-sector enterprises playing a larger role in advancing national security objectives.

“National security is no longer funded by governments alone. It is increasingly strengthened through strategic partnerships between the state and national enterprises.”

Strategic Partnerships: The UAE Connection

Another important feature of Bharat’s evolving energy strategy is its growing emphasis on trusted international partnerships.

Unlike traditional strategic reserves that remain entirely government-owned, Bharat has already adopted a collaborative model with the United Arab Emirates. Abu Dhabi National Oil Company (ADNOC) stores crude oil at the Strategic Petroleum Reserve facility in Mangaluru under an agreement that allows Bharat immediate access to the oil during national emergencies while enabling ADNOC to utilise part of the storage commercially.

This arrangement delivers strategic advantages to both countries. The UAE gains storage close to one of the world’s fastest-growing energy markets, while Bharat secures faster access to crude supplies during periods of disruption without bearing the entire financial cost of maintaining fully government-owned reserves.

More importantly, this partnership reflects a broader evolution in Bharat’s energy strategy. Energy security is no longer measured solely by the volume of crude oil stored underground. It increasingly depends on building trusted relationships with reliable suppliers, diversifying sources of supply, and creating resilient regional energy networks capable of withstanding geopolitical shocks.

As Bharat expands its Strategic Petroleum Reserve capacity, similar partnerships with trusted energy-producing nations could become an integral part of the country’s long-term energy security architecture.

“Strategic reserves are no longer merely stockpiles of oil. They are instruments of diplomacy, resilience, and long-term energy partnerships.”

Energy Security Is National Security

The Ukraine war, repeated disruptions in the Red Sea, sanctions on major energy producers, and recent tensions around the Strait of Hormuz have fundamentally reshaped how governments view energy security.

For decades, energy policy was viewed primarily through an economic lens. The objective was to ensure adequate supplies, manage prices, and meet rising demand. Today, that thinking has changed fundamentally. Energy security has become inseparable from national security.

Countries that lack adequate strategic reserves are significantly more vulnerable to geopolitical shocks. A sudden disruption in crude oil supplies can trigger inflation, weaken industrial production, disrupt transportation networks, widen fiscal deficits, and ultimately constrain a government’s strategic choices during an international crisis.

Energy dependence therefore creates geopolitical dependence.

Conversely, resilient energy systems provide governments with greater diplomatic flexibility and strategic room for manoeuvre. Strategic reserves reduce external vulnerability by giving governments valuable time to respond to crises, stabilise domestic markets, and pursue foreign-policy objectives without immediate economic pressure.

This explains why strategic petroleum reserves are increasingly viewed alongside military preparedness, cyber security, food security, and critical infrastructure protection as essential pillars of national resilience.

“The strength of a nation’s foreign policy ultimately rests on the resilience of its energy security.”

Global Comparisons

Although Bharat has made significant progress in strengthening its Strategic Petroleum Reserves, it still has considerable ground to cover compared with other major economies.

The United States operates one of the world’s largest Strategic Petroleum Reserve systems, while China has steadily expanded its emergency stockpiles as part of its long-term energy security strategy. Japan and South Korea, despite importing the overwhelming majority of their crude oil requirements, also maintain substantial emergency reserves capable of protecting their economies against prolonged supply disruptions.

These countries recognised decades ago that energy security is not simply about purchasing oil when prices are favourable. It is about ensuring that geopolitical crises never become domestic economic crises.

For Bharat, whose economy is expected to become the world’s third largest, energy demand will continue to rise sharply. Expanding Strategic Petroleum Reserves is therefore about much more than matching international standards. It is about preparing the country for the responsibilities and vulnerabilities that accompany major economic power.

“Great powers are built not only on military strength, but also on resilient energy systems capable of withstanding geopolitical shocks.”

Bharat’s Strategic Perspective

For Bharat, expanding Strategic Petroleum Reserves is about far more than safeguarding crude oil supplies. It is about strengthening the country’s strategic autonomy in an increasingly fragmented and unpredictable world. As geopolitical rivalries intensify and global supply chains become more vulnerable to conflicts, sanctions, and maritime disruptions, energy resilience has emerged as a critical pillar of national power.

Bharat has consistently pursued an independent foreign policy, maintaining constructive relations with competing global powers while safeguarding its own national interests. That strategic autonomy, however, depends on reducing vulnerability to external economic shocks. A country that imports nearly 90 percent of its crude oil cannot afford prolonged disruptions that force difficult economic or diplomatic compromises.

The new Strategic Petroleum Reserve therefore strengthens Bharat’s ability to pursue an independent foreign policy with greater confidence. By enhancing energy resilience, it provides policymakers with greater strategic flexibility during periods of international uncertainty.

Equally important, Bharat’s energy security strategy is becoming increasingly partnership-driven. Collaborations with trusted suppliers such as the United Arab Emirates demonstrate that Strategic Petroleum Reserves can serve both commercial and geopolitical objectives. By combining domestic storage capacity with long-term partnerships, Bharat is building a more resilient energy architecture while strengthening its position as one of the Indo-Pacific’s most reliable energy markets.

Recent global crises have reinforced the same strategic lesson. Whether during the COVID-19 pandemic, the Russia-Ukraine war, attacks on commercial shipping in the Red Sea, or tensions in the Strait of Hormuz, resilient supply chains have become just as important to national security as conventional military capabilities.

“For an emerging global power, energy resilience is no longer a strategic advantage. It is a strategic necessity.”

What Comes Next?

The new ONGC project should be viewed as the beginning of a much broader national strategy rather than its culmination.

As Bharat moves towards becoming the world’s third-largest economy, its demand for energy will continue to grow rapidly. Meeting that demand will require a comprehensive strategy that extends well beyond expanding petroleum reserves. Diversifying crude oil import sources, strengthening long-term energy partnerships, increasing domestic hydrocarbon production, expanding renewable energy capacity, and accelerating investments in green hydrogen will all become integral components of Bharat’s long-term energy security architecture.

Strategic preparedness must also extend beyond crude oil. Future national resilience will increasingly depend on securing reliable supplies of liquefied natural gas, critical minerals, rare earth elements, semiconductors, battery materials, and other strategic resources that underpin advanced manufacturing, digital infrastructure, clean energy, and defence technologies.

Strategic competition in the coming decades will increasingly revolve around control over critical resources rather than territory alone. Tomorrow’s geopolitical landscape will be shaped not only by access to oil, but also by the ability to secure energy, technology, critical minerals, and resilient supply chains.

“The strategic reserves of the twenty-first century will include not only oil, but also critical minerals, advanced technologies, and resilient supply chains.”

The Bigger Picture

The expansion of Bharat’s Strategic Petroleum Reserve reflects a much broader transformation in global geopolitics. Energy has evolved from a traded commodity into a strategic instrument of national power. Countries with resilient energy systems enjoy greater economic stability, stronger diplomatic leverage, and enhanced strategic flexibility during periods of international crisis.

The events of recent years, from the pandemic and the Ukraine war to disruptions in the Red Sea and tensions in West Asia, have demonstrated that economic resilience and national security are becoming increasingly interconnected. Governments are no longer preparing only for conventional military conflicts. They are also preparing for disruptions to trade routes, supply chains, financial systems, digital infrastructure, and critical resources.

This shift represents the emergence of a new era of geo-economics, where national power will be measured not only by military capability but also by the ability to secure critical resources and withstand external shocks. Bharat’s investment in Strategic Petroleum Reserves should therefore be viewed as part of a much larger effort to build a resilient economy capable of preserving strategic autonomy in an uncertain world.

BNA Strategic Verdict

ONGC’s new Strategic Petroleum Reserve is far more than another infrastructure project. It reflects a decisive evolution in Bharat’s strategic thinking, where energy security, economic resilience, and geopolitical preparedness are increasingly recognised as inseparable pillars of national power.

The project also signals the emergence of a new model of strategic governance. Financially strong public-sector enterprises are being entrusted with responsibilities that directly contribute to national security, while partnerships with trusted energy producers such as the United Arab Emirates are adding a new dimension to Bharat’s energy diplomacy. Together, these initiatives demonstrate that the country’s energy strategy is becoming more integrated, resilient, and globally connected.

The real significance of the Mangaluru reserve lies not in the millions of barrels it will eventually store, but in the strategic mindset it represents. Bharat is preparing for a world in which geopolitical disruptions are no longer exceptional events but recurring realities. In such an environment, resilience becomes deterrence, preparedness becomes power, and strategic reserves become instruments of national sovereignty.

History has repeatedly shown that wars can disrupt energy supplies overnight. Nations that prepare before a crisis are the ones that preserve economic stability, strategic autonomy, and diplomatic flexibility when that crisis arrives. The new Strategic Petroleum Reserve is therefore far more than an investment in oil storage. It is an investment in Bharat’s ability to safeguard its national interests and pursue an independent foreign policy in an increasingly uncertain geopolitical landscape. 

© Sanjeev Oak