January 29, 2024 [Oil Price]- Aramco is looking to seal more downstream deals in Asia, particularly in China and India, as it bets on continued demand growth in its most important market for long-term buyers of its crude, the Saudi oil giant’s Downstream President Mohammed Al Qahtani told Bloomberg in an interview.
Saudi Aramco, the world’s top crude exporter and the biggest oil firm in terms of both production and market capitalization, has already struck several deals to buy stakes in Chinese refining and chemical projects and has recently entered Pakistan’s downstream sector. But it is on the hunt for more deals.
“Really, the big growth markets for us are China, India and southeast Asia,” Al Qahtani told Bloomberg in an interview in Dhahran, Saudi Arabia.
Aramco wants to grow by both acquisitions and expansion of already operational projects.
“As we speak today we have teams in China negotiating deals,” Aramco’s executive told Bloomberg.
The oil giant is also negotiating deals in India, although progress in talks about “actual investments on the ground” is slower, Al Qahtani said.
In 2021, Aramco and India’s largest private refiner, Reliance Industries, scrapped a planned joint refining project worth $15 billion on valuation differences.
The Indian firm is a big customer for Aramco, which would “love to partner with, so we’ll see,” Al Qahtani told Bloomberg.
Last year, the executive said that “China is strategically important to our business growth in Asia and worldwide, and we will remain a reliable source of long-term oil supply.”
In July 2023, Aramco completed the purchase of a 10% stake in Chinese petrochemical firm Rongsheng Petrochemical Co Ltd for the equivalent of $3.4 billion as the Saudi oil giant continued to expand its downstream footprint in one of its key export markets.
Aramco announced earlier in 2023 two major refinery and petrochemical deals in China, which not only give the world’s largest oil firm a share of the Chinese downstream market but also an additional export outlet for 690,000 barrels per day (bpd) of Saudi crude in China.
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