Abstract: In order to simulate dynamic response of oil tank, a new added mass formula and finite element model is developed. It is implemented into ABAQUS as the user element subroutine. Comparison is made between analysis result and test data for elastic-plastic Elephant Foot Bulging (EFB) and Diamond Shape Bulging (DSB). The reliability for the added mass formula is validated. Some shortcomings are pointed out for the old added mass equation, which is only applicable to oil tanks with rigid wall. Through dynamic response history and frequency response analysis, it is found that the external work on the oil tank model by earthquake loading is a key factor resulting in plastic deformation, EFB and DSB.