Saudi Aramco acquires $3.4 billion stake in a China petrochemical firm

Jack Dutton

Jul 21, 2023

A Sinopec employee looks at a group of jounalists visiting Polypropylene Plant No3 of the Sinopec Yanshan Petrochemical Company (SYPC) during a tour arranged by the State Council Information Office in Beijing on May 25, 2018. (Photo by WANG Zhao / AFP) (Photo credit should read WANG ZHAO/AFP via Getty Images) — A Sinopec employee looks at a group of jounalists visiting Polypropylene Plant No3 of the Sinopec Yanshan Petrochemical Company (SYPC) during a tour arranged by the State Council Information Office in Beijing on May 25, 2018. — WANG ZHAO/AFP via Getty Images

Saudi Aramco has acquired a 10% stake in China’s Rongsheng Petrochemical Co. Ltd. for 24.6 billion renminbi ($3.4 billion), through its subsidiary Aramco Overseas Company BV, based in the Netherlands, the world’s biggest oil company announced Friday.

The deal marks the world’s biggest oil exporter making further inroads in China, which is Saudi Arabia’s top customer for crude. Saudi Arabia, which leads the influential OPEC group, recently moved to extend oil production cuts in a bid to stabilize the market, which has seen a dampened demand from China this year due to its slower-than-anticipated economic recovery from the coronavirus pandemic.

“Our strategic partnership with Rongsheng advances Aramco’s liquids to chemicals strategy while growing our presence in China and showcases our importance as a reliable supplier of crude oil,” Mohammed Al Qahtani, Aramco Downstream president, said in a statement on Friday.

"This key acquisition is an important part of Aramco's long-term growth strategy, expanding our presence in a vital market,” he continued.