EL7.AI
CommoditiesMedium•15 November 2026•
4 min read

Japan to Help ASEAN Develop Shared Oil Storage Amid Supply Disruption Risks

Key Facts

1Japan plans to help ASEAN store petroleum products jointly, according to a report published on 14 November 2026.
2ASEAN is considering storage bases in Indonesia and Thailand as early as 2027.
3ERIA and the Indonesian Business Council signed letters of intent to explore providing the Philippines with emergency oil through facilities in Indonesia and Thailand.
4ERIA’s cooperative model estimated annual costs of $2.19 billion, net benefits of $6.41 billion and a benefit-cost ratio of 3.93.
5ERIA’s model estimated that increasing the share of shared inventory from 10 to 30 days could save $610 million a year, or about 22%.

Japan plans to help the Association of Southeast Asian Nations (ASEAN) store petroleum products jointly in a bid to strengthen regional supply security, the Philippine News Agency reported on 14 November. The move comes as ASEAN countries consider establishing storage bases in Indonesia and Thailand, potentially as early as 2027. The proposed bases would allow member states to receive supplies in emergencies, the agency said. Japanese Prime Minister Sanae Takaichi is scheduled to attend the Asia Zero Emission Community summit on Tuesday. The group brings together Japan, Southeast Asian countries and Australia, putting energy security on the regional cooperation agenda.

Talks on shared storage are advancing in a region heavily dependent on crude oil from the Middle East, according to the Philippine agency. It added that low inventories temporarily made it difficult for member states to buy crude after the effective disruption of the Strait of Hormuz. This gives shared storage a role beyond expanding available capacity: it would allow countries to access supplies when shipping routes are disrupted or deliveries are interrupted. In May, Japan’s Ministry of Economy and the Philippine Department of Energy issued a joint statement on cooperation on the Philippines’ national strategic petroleum reserve program and ASEAN-wide shared storage. Japan’s economy minister at the time said the country would contribute its expertise in building the system, which it has maintained for more than 50 years since the oil crises of the 1970s.

A practical track for the initiative took shape on 14 November, when the Economic Research Institute for ASEAN and East Asia (ERIA) and the Indonesian Business Council said they had signed letters of intent with energy companies to explore providing the Philippines with emergency oil through existing storage facilities in Indonesia and Thailand. The projects are examining an “oil ticket” mechanism, under which a participating party pays for the right to access oil stored in another country during an emergency. The Philippines–Indonesia track includes PNOC-EC and PT Interport Mandiri Utama, while the Philippines–Thailand track includes PNOC-EC and Shell Thailand. ERIA said relying on existing facilities could reduce governments’ need to build new installations and purchase additional inventories in advance. The letters remain a framework for exploring emergency access arrangements as ASEAN countries consider regional storage bases.

Figures cited by ERIA reflect the region’s exposure to external supply fluctuations: Southeast Asia’s dependence on crude imports reached about 66% in 2024. The Philippines imports 99% of its crude needs, compared with 94% for Thailand, according to the institute’s estimates. This gives the proposed storage corridors particular importance for the Philippines and Thailand, both of which are part of the emergency access arrangements. The initiative is based on using existing facilities rather than waiting for new sites to be built, ERIA said. Japan–Philippines cooperation has also previously covered the Philippines’ national reserve program alongside an ASEAN-wide storage framework.

In a paper published in November under the number 2026-4, ERIA said the priority should be to launch voluntary pilot projects and public-private partnerships, rather than establish a unified ASEAN reserve all at once. Its analysis used a regional oil demand baseline of 5.0 million barrels per day and estimated a 90-day reference benchmark at about 450 million barrels. These figures are analytical references in the paper, not a unified commitment agreed by ASEAN countries. In a cooperative scenario, ERIA estimated annual costs at $2.19 billion and annual net benefits at $6.41 billion, with a benefit-cost ratio of 3.93. These estimates show the potential case for coordination under the institute’s model; they were not presented as costs or benefits already realized.

ERIA says increasing the share of shared inventory from 10 to 30 days, while holding the total volume constant and retaining five days of inventory through tickets, could reduce annual carrying costs from $2.80 billion to $2.19 billion. That would amount to estimated annual savings of $610 million, or about 22%, under the model scenario. The paper called for pilot projects to test the technical, commercial, financial, legal and operational aspects of different storage arrangements. Proposed tests include emergency access, inventory release mechanisms, cross-border transport and verification. ERIA’s roadmap for shared storage was scheduled to be announced at the ASEAN summit and the Asia Zero Emission Community leaders’ meeting in the autumn, as Takaichi prepares to attend the community’s summit on Tuesday.