Petroleum ReservesPublished on 01.14.2015
5 min read
Industrialized countries build oil and gas reserves so they can adjust supply to fluctuating consumer demand in real time and hold while it awaits refining. Oil stocks are also a buffer against the fallout from international crises.
© LABELLE MICHEL - TOTAL - Tank farm at the SATORP refinery in Jubail, Saudi Arabia.
Strategic Petroleum Reserves
Oil has been a highly strategic resource for industrialized countries since the 20th century. This source of energy has enabled them to develop and is a linchpin of their economies. This is why they make sure they have sufficient reserves of crude oil and petroleum products. These reserves provide a measure of self-sufficiency so that they have something to fall back on if, for example, their oil imports are suddenly cut off.
In 1968, the European Commission imposed a requirement on European Union member states to maintain the equivalent of 65 days’ worth of oil imports in reserves. In 1972, against the backdrop of the oil crisis, this was increased to 90 days. In addition, as of 2012, all E.U. member states have been required to publish a monthly report on their strategic reserves.
Freshly delivered crude oil can be stored not just for strategic reasons, but also simply pending refining.
Depending on the country, petroleum product storage depots are managed by state-owned companies, private companies or both, working in tandem. In France, regional inventories ensure the availability of 10 days’ worth of premium gasoline, and two weeks’ worth of heating oil and . There are over 50 depots, or tank farms, where petroleum products are stored in tanks of different sizes, sometimes buried.
The organizations that manage these storage depots must meet a number of safety and security standards. The two main risks that must be prevented are:
- Land and water pollution caused by leaks. To prevent this type of pollution, the tanks are regularly inspected and the extend of (wear and tear) is checked. Acid gases — carbon dioxide and sulfide — contained in the oil can corrode the tanks over time.