The 21 July completion of Saudi Aramco’s RMB24.6bn ($3.4bn) purchase of a 10% stake in China’s Rongsheng Petrochemical marks the next major step in Aramco’s ambitious plans to grow its footprint in the world’s largest oil import market. Through the deal, originally inked in March, Aramco will supply 480,000 b/d of crude oil to Rongsheng’s 51% affiliate Zhejiang Petroleum and Chemical’s (ZPC) 800,000 b/d refinery (MEES, 21 July).
Saudi Aramco’s crude oil exports to China have garnered particular attention over the past 18 months. China is the kingdom’s largest crude oil export market, but as with other Middle East exporters, it has had to contend with a flood of displaced Russian volumes which have threatened to squeeze its market share. So far Saudi volumes have held up, and indeed at 1.87mn b/d for the first six months of 2023 (see chart) are up 7.3% year-on-year, but the kingdom has been pushed down into second place by Russia’s 2.12mn b/d H1 average (MEES, 21 July). (CONTINUED - 898 WORDS)