Saudi Arabia and UAE Join Japan's Asian Oil Stockpiling Initiative

Saudi Arabia and the United Arab Emirates joined a special session of the Asia Zero Emission Community (AZEC) in Manila on Thursday to cooperate on strengthening oil stockpiling capacity across Asia. Led by the Government of Japan, the 11-partner framework aims to bolster regional energy security and build the capacity to respond to supply shocks.

The initiative follows severe energy disruptions and soaring costs caused by the US-Iran war, which began in late February and resulted in the closure of the Strait of Hormuz. In response to these vulnerabilities, Japanese Prime Minister Sanae Takaichi announced $10 billion in financial support in April to assist Southeast Asian nations with emergency reserves and oil procurement.

The proposed framework allows Asian buying countries to negotiate bilateral supply arrangements with Middle Eastern producers. This strategy intends to position crude oil closer to end customers to mitigate future risks. During the session, Philippines Energy Secretary Sharon Garin noted that disruptions at the Strait of Hormuz reinforced the need for collective preparedness against energy supply shocks.