ASEAN Oil Stockpile Ambition: Destined for the Same Old Fate?

HOME ARTICLES ASEAN Oil Stockpile Ambition: Destined for the Same Old Fate? An oil storage facility in Laizhou, China. (Photo by Stringer / CFoto / CFOTO via AFP) There is revived interest in developing an ASEAN oil stockpile, a decades-old concept. The rationale is clear, but the hurdles remain high. ASEAN leaders at the 48 th ASEAN Summit in May 2026 discussed a proposal to develop an ASEAN oil stockpile . Triggered by the energy crisis following the US-Israel attack on Iran, this move reflects renewed efforts to foster energy security. However, a review of ASEAN records offers little reason for optimism. Unless the bloc moves quickly to institutionalise it and prepare an implementation plan, the latest ambition is vulnerable to being quietly shelved. Initial reactions to the proposal are mixed. The Philippines and Japan have discussed cooperation to advance joint stockpiling plans for the Philippines, and for ASEAN more broadly. Indonesia expressed readiness to host an ASEAN oil storage hub. Singapore emphasised that the proposal was not yet sufficiently developed, noting that further discussion would depend on continued interest, while Malaysia underscored the financial constraints. The positions of other ASEAN countries remain largely speculative, with some analysts suggesting that bilateral energy cooperation with external partners could shape some countries’ responses. There is a firm rationale for ASEAN oil reserves while fostering an energy transition. The IEA’s 2026 Southeast Asia Energy Outlook projects that Southeast Asia will account for one-fifth of global energy demand growth from now until 2035. The region still relies on fossil fuel for most of its power generation, and is exposed to geopolitical risks with 60 percent of its crude oil imports originating from the Middle East. Moreover, oil reserves across ASEAN remain inadequate and unevenly distributed. Most ASEAN economies maintain 20–50 days of demand, mainly in the form of commercial stocks. The concept of regional oil stockpiling is not new. In 1986, the ASEAN Petroleum Security Agreement (APSA) was signed, providing a framework for an emergency oil-sharing mechanism. In response to its limitations, ASEAN adopted a new APSA in 2009, which only entered into force in 2013 following Indonesia’s ratification. The 2009 agreement , which was renewed in 2025 after reaching its expiry, specifically states that ASEAN countries shall endeavour to develop joint oil stockpiling, in addition to national reserves. However, this is a voluntary framework that provides little incentive for ASEAN countries to collectively invest in costly regional infrastructure, ultimately leading to inaction. ASEAN+3 cooperation is another platform that has given special attention to oil stockpiling. The first ASEAN+3 energy ministers meeting in 2004, with their China, Japan and South Korea counterparts, identified regional oil stockpiling as a strategic priority. During that meeting, then-Philippine Energy Secretary Vincent Perez proposed the former US naval base at Subic Bay as a potential regional storage facility. An ASEAN+3 working group subsequently produced the Oil Stockpiling Roadmap, which was approved in 2010. Nevertheless, the roadmap never resulted in an operational plan, and the idea of joint stockpiling ultimately disappeared from the agenda . Outside ASEAN mechanisms, some Southeast Asian countries have also explored joint oil stockpiling through the Asia-Pacific Economic Cooperation (APEC) forum and the Asia Cooperation Dialogue (ACD). APEC released a report on joint stockpiling options for its members in 2000, and ACD countries agreed to assess the feasibility of a similar initiative in 2004. However, none of these initiatives advanced to stockpiling cooperation beyond knowledge exchange and capacity building. Unless ASEAN countries quickly build a solid foundation and move towards rapid implementation, it risks becoming another stalled attempt. Why did previous efforts fail? Establishing and maintaining oil reserves is costly, and ASEAN countries differ notably in their dependence on imported oil, technical standards, and emergency planning. Concerns over security, governance, and free-riding, plus a lack of trust, further undermine cooperation. These obstacles remain largely unaddressed today. As such, although geopolitical tensions might strengthen the case for regional reserves, there is little reason to believe the current proposal will produce a different outcome. Compounding these structural hurdles is the declining momentum. Should global energy prices remain stable in the coming months, the sense of urgency will likely diminish, thereby risking the gradual fading of the new ambition. A similar pattern was observed during the Covid-19 crisis, when ASEAN committed to pursuing a green recovery and mobilising the necessary investment. Once the crisis eased and new challenges such as rising energy prices emerged, many ASEAN countries wavered in their commitments and returned to environmentally harmful measures . Looking Ahead To sustain the proposal raised at the 48 th Summit, ASEAN must swiftly institutionalise this new ambition and build a stronger foundation for a regional oil stockpile agreement beyond a loose, voluntary framework. The first step is to adopt a high-level instrument mandating relevant sectoral bodies to prepare for the development of a joint stockpile, which should be secured soon while momentum remains. To ensure that the commitment translates into progress, the subsequent step is to prepare an implementation roadmap, financing arrangements, and a working group to oversee implementation. The high costs of oil stockpiling are among the key challenges to be addressed. In this regard, ASEAN can consider different joint stockpiling options. For example, while baseline annual costs for own stockholding typically range from USD7.0–8.6 per barrel (bbl) , alternative models can significantly reduce the expenses. A study estimated that a ticket system — where countries purchase rights to draw upon emergency oil held in a seller’s facility — costs ASEAN around US$5.9/bbl, while joint stockpiling with oil-exporting countries costs just US$3.7–3.8/bbl. Should full consensus prove unattainable, ASEAN can employ the “ASEAN Minus X” formula to design and launch a pilot project with majority support. This approach has been utilised in economic cooperation, such as trade in services . The proposal for an ASEAN oil stockpile could be a strategic response to the recent energy crisis. However, unless ASEAN countries quickly build a solid foundation and move towards rapid implementation, it risks becoming another stalled attempt. 2026/203 Dr Elbinsar Purba is Visiting Fellow at the Climate Change in Southeast Asia Programme of ISEAS – Yusof Ishak Institute. He was previously Officer of Poverty Eradication & Gender Division at the ASEAN Secretariat. Subscribe to Fulcrum for regular updates Subscribe Post navigation