We can fix this issue by creating the cache directory and then transferring the ownership to the Squid user manually.
mkdir /opt/squid/var/cache chown nobody:nobody /opt/squid/var/cache
The previous commands will create the cache directory and will transfer the ownership to the Squid user.
If we try to create the swap directories now, the command will succeed and will output something like this:
[root@saini etc]# /opt/squid/sbin/squid -z 2010/11/10 00:44:16| Creating Swap Directories 2010/11/10 00:44:16| /opt/squid/var/cache exists 2010/11/10 00:44:16| Making directories in /opt/squid/var/cache/00 2010/11/10 00:44:16| Making directories in /opt/squid/var/cache/01 ...
We learned how to create the cache directory with proper ownership, so that Squid can create the swap directories without any problems.