Aramco's entry into Saudi fuel retail secures long-term market for its oil

Saudi Aramco's plan to set up and run petrol stations across the kingdom will help the world's biggest crude exporter secure a long-term market for its oil barrels and expand its services in line with the offerings of its global rivals, analysts say.

The state-owned company's expansion into the fuel retail business is the next logical step - and a long time coming - after signing major international deals in refining and petrochemicals as part of its strategy to grow across the energy supply chain, economists and analysts said.

"It will help secure a long-term market share for Aramco oil barrels when they buy into the retail distribution system and have guaranteed access," Edward Bell, commodities analyst at Emirates NBD, said. "Expanding in retail makes sense for a company that's positioning itself like a big international oil company."

The oil giant on Wednesday said it formed a fully-owned subsidiary, Saudi Aramco RetailCo, to establish a network of gas stations and convenience stores in the country. Aramco is focusing on becoming an integrated energy company, which means it is expanding its operations beyond oil extraction into the entire supply chain including refining, marketing and distribution of fuels and petrochemicals. The company is increasingly seeking opportunities in downstream projects and is in talks to buy a 70 per cent stake in Saudi Basic Industries Corporation, one of the biggest petrochemicals manufacturers in the Middle East, from the Saudi sovereign wealth fund.

Aramco will likely face competition from the UAE-based Adnoc Distribution, the UAE's biggest fuel and convenience retailer, which is slated to open two stations in Saudi Arabia, its first foray outside its home market. Emirates National Oil Company is undertaking refurbishment of fuel service stations in the kingdom and is close to completing its planned 15 retail units, chief executive Saif Al Falasi told The National in October.

_______________

Aramco’s potential Sabic stake acquisition could impact IPO, says CEO

_______________

The retail expansion, "if you look at Aramco with the lens of them touching every bit of the energy supply chain", is the next move in line, Mr Bell said.

Aramco, which was previously focused on upstream operations, could gain a "natural hedge" by entering into fuel retail that would give it an extra buffer in case of weaker crude prices, he said.

The oil major said on Wednesday that RetailCo will be a "sustainable and profitable business that integrates across the hydrocarbon value chain."

"It's the norm for a national oil company to run petrol stations in its home market," Robin Mills, chief executive of consultancy Qamar Energy, said. "It's funny that they haven't done it until now."

Aramco would have a competitive edge over other fuel retailing rivals in the Saudi market as the company has infrastructure from refineries to logistics already in place, he noted.

"It's a large and fast-growing market," Mr Mills said. "If Aramco wants to go downstream, it makes sense for them to be in retailing in the home market."

An Aramco spokesman on Thursday declined to comment on the cost, size or the timeline for the project when contacted by The National .

Adding fuel retail services in its home market will help Aramco compete with global oil companies such as Shell or BP, and provide a benchmark for investors to compare the Saudi oil producer with its international peers, Mr Bell said.

The move into fuel retailing will allow Aramco to lift the service standards at the gas stations on the kingdom's vast network of highways, Ihsan Buhulaiga, a Saudi economist said.

"For consumers, it will improve the level of service and that sector really needs capable investors with the financial muscle to make the difference," he said.

Aramco in April said that it’s studying the joint purchase of a retail network in Saudi Arabia with French oil major Total but it made no mention of the French company in Wednesday's announcement.

As part of becoming a fully integrated energy company, Aramco's trading arm plans to start handling crude in Asia through its office in Singapore in the third quarter of this year and aims to boost its volumes for trading crude and refined products to 6 million barrels per day (bpd) by 2020, according to Reuters.

THE%20SPECS

%3Cp%3EEngine%3A%203-litre%20V6%20turbo%20(standard%20model%2C%20E-hybrid)%3B%204-litre%20V8%20biturbo%20(S)%0D%3Cbr%3EPower%3A%20350hp%20(standard)%3B%20463hp%20(E-hybrid)%3B%20467hp%20(S)%0D%3Cbr%3ETorque%3A%20500Nm%20(standard)%3B%20650Nm%20(E-hybrid)%3B%20600Nm%20(S)%0D%0D%3Cbr%3EPrice%3A%20From%20Dh368%2C500%0D%3Cbr%3EOn%20sale%3A%20Now%3C%2Fp%3E%0A

The biog

Name: Dhabia Khalifa AlQubaisi

Age: 23

How she spends spare time: Playing with cats at the clinic and feeding them

Inspiration: My father. He’s a hard working man who has been through a lot to provide us with everything we need

Favourite book: Attitude, emotions and the psychology of cats by Dr Nicholes Dodman

Favourit film: 101 Dalmatians - it remind me of my childhood and began my love of dogs

Word of advice: By being patient, good things will come and by staying positive you’ll have the will to continue to love what you're doing

MATCH INFO

Inter Milan 1 (Martinez 18' pen)

Juventus 2 (Dybala 4', Higuain 80')

How to avoid crypto fraud

Use unique usernames and passwords while enabling multi-factor authentication.
Use an offline private key, a physical device that requires manual activation, whenever you access your wallet.
Avoid suspicious social media ads promoting fraudulent schemes.
Only invest in crypto projects that you fully understand.
Critically assess whether a project’s promises or returns seem too good to be true.
Only use reputable platforms that have a track record of strong regulatory compliance.
Store funds in hardware wallets as opposed to online exchanges.

Race card

5pm: Maiden (PA) Dh80,000 1,600m

5.30pm: Maiden (PA) Dh80,000 1,600m

6pm: Arabian Triple Crown Round-2 Group 3 (PA) Dh300,000 2,200m

6.30pm: Liwa Oaisi Group 2 (PA) Dh300,000 1,400m

7pm: Wathba Stallions Cup Handicap (PA) Dh70,000 1,600m

7.30pm: Handicap (TB) Dh100,000 1,600m

The National selections: 5pm: Flit Al Maury, 5.30pm: Sadah, 6pm: RB Seqondtonone, 6.30pm: RB Money To Burn, 7pm: SS Jalmood, 7.30pm: Dalaalaat

COMPANY%20PROFILE

%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Revibe%20%0D%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202022%0D%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Hamza%20Iraqui%20and%20Abdessamad%20Ben%20Zakour%20%0D%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20UAE%20%0D%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Refurbished%20electronics%20%0D%3Cbr%3E%3Cstrong%3EFunds%20raised%20so%20far%3A%3C%2Fstrong%3E%20%2410m%20%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EFlat6Labs%2C%20Resonance%20and%20various%20others%0D%3C%2Fp%3E%0A

The specs: 2018 Jaguar E-Pace First Edition

Price, base / as tested: Dh186,480 / Dh252,735

Engine: 2.0-litre four-cylinder

Power: 246hp @ 5,500rpm

Torque: 365Nm @ 1,200rpm

Transmission: Nine-speed automatic

Fuel consumption, combined: 7.7L / 100km

Dubai Women's Tour teams

Agolico BMC
Andy Schleck Cycles-Immo Losch
Aromitalia Basso Bikes Vaiano
Cogeas Mettler Look
Doltcini-Van Eyck Sport
Hitec Products – Birk Sport
Kazakhstan National Team
Kuwait Cycling Team
Macogep Tornatech Girondins de Bordeaux
Minsk Cycling Club
Pannonia Regional Team (Fehérvár)
Team Auvergne-Rhône-Alpes
Team Ciclotel
UAE Women’s Team
Under 23 Kazakhstan Team
Wheel Divas Cycling Team

The biog

Date of birth: 27 May, 1995

Place of birth: Dubai, UAE

Status: Single

School: Al Ittihad private school in Al Mamzar

University: University of Sharjah

Degree: Renewable and Sustainable Energy

Hobby: I enjoy travelling a lot, not just for fun, but I like to cross things off my bucket list and the map and do something there like a 'green project'.

SCHEDULE

6.30pm Maiden Dh165,000 (Dirt) 1,400m
7.05pm: Handicap Dh170,000 (D) 1,600m
7.40pm: Maiden Dh165,000 (D) 1,600m
8.15pm: Handicap Dh210,000 (D) 1,200m
8.50pm: Handicap Dh210,000 (D) 2,000m
9.25pm:Handicap Dh185,000 (D) 1,400m

Amith's predicted winners:
6.30pm: Down On Da Bayou
7.05pm: Etisalat
7.40pm: Mulfit
8.15pm: Pennsylvania Dutch
8.50pm: Mudallel
9.25pm: Midnight Sands

Cricket World Cup League 2

UAE squad

Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind

Fixtures

Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE