Asia should build oil reserve: EIA

Dow Jones, Singapore

With petroleum demand in developing nations, particularly in Asia, outstripping the rest of the world, building oil stocks for energy security will become more of a priority, according to a senior economist with International Energy Agency.

"As Asia grows more import dependent, its susceptibility to supply disruptions of any kind will create more of an incentive to build operating and strategic stocks," Klaus Rehaag, editor of the monthly IEA Oil Market Report, said Monday.

A few Southeast Asian countries, including the Philippines and Thailand, recently have indicated plans to create or boost oil reserves.

Thailand's government said last month that it planned to raise its petroleum inventory by increasing refinery output and slashing exports.

This decision was made due to concerns of supply disruptions following the Sept. 11 attacks in New York and Washington.

The Thai government ordered refiners to raise oil products and crude reserves from 3 percent to 5 percent of annual consumption.

The Philippine Energy Secretary said at a recent energy conference in Buenos Aires that his government is considering taking advantage of a six-week slide in crude prices to create an oil stockpile.

Rehaag said as regional oil reserves, including those in Indonesia and Malaysia, dry up, Asia will become more and more dependent on imported crudes from the Middle East.