State giant Saudi Aramco views expanding its international downstream activities as a key priority and is progressing towards key investments. The firm’s recently-released Bond prospectus stated that it is “focusing its downstream investments in areas of high-growth, including China, India and Southeast Asia, material demand centers, such as the United States, and countries that rely on importing crude oil, such as Japan and South Korea.”

The rationale for expanding Aramco’s downstream footprint is clear. For one thing, increased vertical integration enables the company to move up the value chain, and to act as a hedge against low oil prices. It also helps secure crude markets for Aramco. The firm’s bond prospectus notes approvingly that Aramco supplied an average of 68% of the crude run in its international refineries, well in excess on its 58% ”weighted average ownership percentage” in the same plants. (CONTINUED - 1066 WORDS)