According to a report by Reuters on October 26, energy ministers from Saudi Arabia and Singapore announced that Saudi Arabia plans to store crude oil in underground caves on Jurong Island in Singapore starting in the second half of 2027, in order to strengthen the security of crude oil supplies in Asia.
Singapore's Minister for Energy, Trade and Industry, Chen Shilong, said at the Singapore International Energy Week conference: "Saudi Arabia and Singapore have announced that we are ready to develop a joint agreement to store Saudi crude oil in Yulong Rock Caves starting from the second half of 2027. This arrangement will enhance the resilience of the Saudi crude oil supply chain in Southeast Asia, and also help improve Singapore's energy security and resilience in case of supply disruptions."
Chen Shilong stated that Saudi Aramco will sign a memorandum of understanding with the Singapore Energy Market Authority and Jurong Group, with the goal of completing negotiations within the next few months.
Saudi Energy Minister Abdulaziz bin Salman said: "Reducing the distance between supply and major Asian markets will enhance the flexibility of our supply network and support Singapore's supply security and preparedness."
Reports indicate that the cavern in Yunglo Island is located 150 meters underground and can store 1.47 million cubic meters of liquid hydrocarbons, such as crude oil and condensate. Saudi Aramco currently stores crude oil in Japan and South Korea. Local governments have the right to purchase crude oil from these storage tanks in case of unexpected shortages.
This is one of the latest responses taken by Saudi Arabia after the military strikes against Iran by the United States and Israel. With the closure of the Strait of Hormuz, the amount of crude oil exported to the international market in the Middle East has significantly decreased, putting some Asian countries at risk of having a shortage of crude oil reserves.
