TITLE: Two-stage preconditioners for inexact Newton methods in multi-phase reservoir simulation ABSTRACT: We discuss two-stage preconditioners for solving systems of coupled nonlinear partial differential equations in the modeling of underground multiphase flow phenomena. The linear systems arising from the discretization and Newton linearization are nonsymmetric and indefinite but coefficient blocks associated with a particular type of unknown possess properties that can be exploited to improve the conditioning of the coupled system. We show through theoretical discussion and numerical experiments that decoupling strategies combined with two-stage preconditioners are more effective to accelerate Krylov subspace methods such as GMRES\ and BiCGSTAB than standard ones which ``blindly'' precondition the entire coupled linear system. We also show a distributed memory parallel implementation of some of the iterative schemes proposed in this work.