India and the United Arab Emirates signed a strategic energy agreement on May 15, 2026, to enhance bilateral cooperation and energy security.
The deal strengthens India's long-term energy stability by diversifying supply routes and ensuring a reliable reserve of crude oil. It represents a deepening of economic ties between the two nations through shared infrastructure, and trading cooperation.
Under the terms of the agreement, the UAE will store up to 30 million barrels [1] of crude oil within India’s Strategic Petroleum Reserve. The pact was signed in Abu Dhabi during a visit by Prime Minister Narendra Modi, who met with UAE President Sheikh Mohamed bin Zayed Al Nahyan.
Indian Foreign Secretary Vikram Misri said the arrangement includes expanding fuel storage and supply cooperation. The agreement also focuses on trading cooperation to stabilize energy flows between the two regions.
A critical component of the strategy involves diversifying supply routes. The two nations intend to move more oil via Fujairah, which allows shipments to bypass the Strait of Hormuz — a move designed to mitigate risks associated with regional instability.
Beyond oil storage, the pact includes broader cooperation across energy and economic sectors. The arrangement aims to integrate the energy markets of both nations more closely to protect against global price volatility, and supply chain disruptions.
“The UAE will store up to 30 million barrels of crude oil in India’s Strategic Petroleum Reserve.”
This agreement reduces India's vulnerability to geopolitical tensions in the Strait of Hormuz, one of the world's most critical oil transit chokepoints. By allowing the UAE to utilize Indian storage facilities, both nations create a reciprocal dependency that stabilizes energy pricing and ensures India has immediate access to physical reserves during global supply shocks.
