The MT Inspiration took on two million barrels of Abu Dhabi crude in May 2018. Its destination was an underground cavern in Mangalore, on India's west coast, where the oil would help fill a stockpile India could draw on in an emergency. The shipment was the first under a deal that gave Abu Dhabi National Oil Company (ADNOC) room to store 5.86 million barrels in India at its own cost.
Eight years later, the two countries are considering an arrangement in the other direction. In May 2026, India's prime minister's office said New Delhi could hold part of its strategic oil reserve in Fujairah, where tankers can load outside the Strait of Hormuz. The same agreement opened the door for ADNOC to store up to 30 million barrels in India.
The proposal reflects how far the trade has come. India was buying billions of dollars of UAE oil well before the Mangalore deal. Indian companies now have a stake in an Abu Dhabi oilfield, while the UAE has built an export route that gives buyers access to Abu Dhabi crude when shipping through Hormuz is disrupted.
India was importing fewer than one million barrels of oil a day in the 1990s. By 2018, that figure had reached about 4.4 million barrels a day, according to an analysis of Indian petroleum ministry data by the King Abdullah Petroleum Studies and Research Center. The UAE was already an established supplier by the early 2010s. In the 2011–12 financial year, India bought $15.1 billion of UAE oil, accounting for 8.7% of its oil import bill, according to Indian trade figures compiled by the Institute for Defence Studies and Analyses.
As India's import needs grew, its state-owned companies secured a share of production. In 2018, ONGC Videsh, Indian Oil Corporation and Bharat PetroResources paid $600 million for a 10% interest in Abu Dhabi's Lower Zakum offshore concession. India's petroleum ministry told Parliament it was the country's first investment in Gulf oil production. It estimated that the stake would give the consortium an average of 1.75 million tonnes of crude a year over the 40-year concession.
That year, the Mangalore shipment put UAE crude inside India's emergency reserve system. Lower Zakum gave Indian companies a share of future production at the other end of the trade. By 2026, India's Ministry of External Affairs listed the UAE as the country's fourth-largest source of crude and its second-largest source of both liquefied natural gas and liquefied petroleum gas.
The May agreement could extend ADNOC's role from a cavern on India's west coast to reserve sites in the east. India's prime minister's office identified Visakhapatnam, in Andhra Pradesh, as a site where ADNOC could participate in an existing facility. It also identified Chandikol, in Odisha, as a location where the two sides could work on developing reserve facilities. The proposed 30 million barrels is the potential total for ADNOC crude storage in India under the agreement.
Fujairah would serve a different purpose. Oil held there would form part of India's strategic reserve while remaining on the UAE side of the Arabian Sea. The memorandum also covers possible cooperation on storage facilities in India for liquefied natural gas, or LNG, and liquefied petroleum gas, or LPG.
The port already gives Abu Dhabi a way to ship oil without passing through Hormuz. ADNOC's existing 406km pipeline carries crude from its onshore operations to Fujairah, where tankers can load for India. The route took on greater significance in 2026 as the conflict in the Gulf disrupted shipping through the strait, a risk India's finance ministry highlighted in its May economic report.
ADNOC is building a second route to the port. In May, the company said its West–East Pipeline was under construction and expected to become operational in 2027. ADNOC expects the project to double its export capacity through Fujairah.
The May visit also produced a separate agreement between ADNOC and Indian Oil to explore long-term LPG supplies. The Indian government said the companies would look at opportunities to buy and sell the fuel, widely used for cooking in India, including through a potential long-term supply contract.
The two companies already have a long-term deal for LNG. In August 2025, ADNOC signed a 15-year agreement to supply Indian Oil with up to one million tonnes a year, mainly from its Ruwais project. ADNOC expects Indian Oil's total purchases under its long-term agreements to reach 2.2 million tonnes a year from 2029, making it the Abu Dhabi group's largest LNG customer.
ADNOC Gas followed in January 2026 with a 10-year LNG contract for Hindustan Petroleum Corporation, valued at $2.5 billion to $3 billion. The company expects India to take 20% of the LNG it operates by 2029.
The Fujairah reserve remains a proposal. If it goes ahead, the route that brought UAE crude to fill an Indian emergency cavern in 2018 could also give India a stockpile it can draw from at the other end of the voyage.
