The reserve was mooted by the Indian government on 7 January and the IEA feels that its in important step in helping India to achieve oil reserves that can last for 45 days, as mooted by Indian Prime Minister Atal Bihari Vajpayee in February last year.

According to IEA's deputy executive director, William Ramsay, such a move is a good thing in the light of global uncertainties. "Given India's increasing oil imports, and subsequent influence on the global oil market, the establishment of Indian strategic oil stocks will certainly reinforce global oil security," said Ramsay, who also happens the US Ambassador to India.

India is currently the world's seventh largest oil consumer.