MANILA, Sept 22 (Reuters) - The Philippines' Department of Energy said on Wednesday it has issued a circular to establish state-owned reserves of crude oil, finished petroleum products and biofuels, which can be tapped if there are supply disruptions in the global market.

State-owned Philippine National Oil Company will construct, buy or lease storage facilities for such reserves and seek supply contracts under what it called the Philippine Strategic Petroleum Reserve Programme.

The size and timing of purchases remained unclear, but Energy Secretary Alfonso Cusi, in a statement, described the "strategic petroleum reserve" as consisting of "large stockpiles of crude oil as well as petroleum products, stored in facilities located around the country, and possibly overseas".

The reserve will complement the minimum inventory requirement for oil companies such as Petron Corp, Pilipinas Shell Petroleum Corp, Chevron Philippines Inc, and other local retailers.

The Southeast Asian country's petroleum inventory as of the end of 2020 saw a 39% drop from the previous year to 2.34 billion litres in terms of both crude and finished products, due to refinery shutdowns and COVID-19 lockdowns, government data showed.

More than two thirds of Philippine oil imports come from Middle East producers, led by Saudi Arabia.

The country's total demand for petroleum products last year was 22.6 billion litres, down 17.3% from 2019. (Reporting by Enrico Dela Cruz Editing by Ed Davies)