Oil minister Dharmendra Pradhan and Aramco CEO Amin Nasser jointly inaugurated the company’s office in Gurugram. Pradhan said the move would take the buyer-supplier relationship between the two countries to a level of “strategic partnership” in hydrocarbon sector.
Aramco’s talks with Indian state-run refiners also encompasses increased LPG supplies and a foothold in petrochemicals businesses.
The world’s largest oil exporter, Saudi Aramco, on Sunday officially launched its unit in India with a view to tap opportunities presented by the country’s rapidly growing appetite for energy.
Oil minister Dharmendra Pradhan and Aramco CEO Amin Nasser, who is here to attend the India Energy Forum beginning on Monday, jointly inaugurated the company’s office in Gurgaon, a move the minister said would take the buyer-supplier relationship between the two countries+ to a level of “strategic partnership” in the hydrocarbon sector.
Aramco’s move to launch a subsidiary in India, Aramco Asia India (AAI), coincides with its ongoing talks for acquiring a stake in the Rs 40,000 crore coastal refinery being planned in Maharashtra by an IndianOil-led consortium of state-run refiner-marketers.
India is particularly important for Aramco as the firm is trawling for refinery stake in major oil-consuming economies to lock in customers ahead of its IPO next year.
Both International Energy Agency and BP Statistical Review of World Energy have projected India’s oil consumption growth to be the fastest among all major economies over the next two decades. India has already surpassed Japan as the world’s third largest oil consumer and is expected to overtake China.
But Aramco, traditionally India’s top oil supplier, has not found the going smooth in such a growing market in the face of challenge from fellow Opec member Iraq.
According to a Reuters report, Iraq remained India’s top oil supplier for the fifth month running in August.
Besides, India is also leveraging the oversupplied condition of the global oil market and flexibility of its refineries to tap new sources such as the US.
No wonder, Aramco’s talks with Indian state-run refiners are not limited to locking in sale of crude but also encompasses increased LPG supplies and a foothold in petrochemicals and fuel retail businesses.
Saudi Arabia accounts for approximately 19% of India’s crude and 29% of LPG imports. During 2016 -17, India imported about 39.5 million tonnes of crude from Saudi Arabia.