Aramco not concerned by Asian market competition

21 July 2016

Saudi Arabia’s oil giant is increasing its own client base in Asian markets

Saudi Arabia’s state-owned oil giant Saudi Aramco is not concerned about increased competition from other oil-producing nations for crude sales in Asia as the company is expanding its own client base in that market.

Aramco offers the “reliability of supply and the quality of crudes, so various companies see big value and benefit in dealing with Aramco,” news agency Reuters quoted Aramco chief executive Amin Nasser as saying. When asked if he was worried about other producers gaining market share in Asia, he replied, “Customers are increasing, no we are not.”

Nasser’s comments came after Iraq overtook Saudi Arabia for the first time as India’s top oil supplier in the June quarter, helped by sales of discounted heavy crude that refiners have also been using to make bitumen to build roads in the world’s third-biggest oil consumer.

To combat attempts to steal market share, Aramco this month also slashed the August official selling price (OSP) of its benchmark light crude grade to Asia by the most in nine months and analysts warned it may need to make deeper cuts, according to the news agency.

Speaking on the sidelines of a company event, the CEO said Aramco’s Wasit gas plant, which has a processing capacity of 2.5 billion standard cubic feet a day, has reached full capacity. The project is one of the largest gas plants built by Aramco.

Separately, Nasser said the planned Jizan refinery will come online in 2018, while the firm is still studying plans for a Clean Fuels Project. The refinery, in the southwest of the kingdom, is slated to process 400,000 barrels a day when fully operational.

 

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