(Reuters) – The world’s top oil exporter Saudi Aramco will open an office in India by the end of this year to help boost its crude sales in the world’s fourth largest oil consuming nation, sources with knowledge of the matter said.
India is one of the biggest markets for Saudi oil. In fact, Saudi Arabia has been the top supplier to the South Asian nation for the past 14 years starting April 2001, according to the government data.
Saudi Arabia’s share in India’s crude intake has, however, dropped to about 18.5 percent in the year to March 2015 from about a quarter a decade ago, while India’s refinery capacity has doubled to about 4.6 million barrels per day in the period.
“With the new office, Aramco will integrate its existing operations in India run through Aramco Overseas with the crude sales business,” said one of the sources, adding that India was a bright spot in an otherwise sluggish global oil sector as fuel demand in the country was rising contrary to other regions.
Saudi Arabia opened Aramco Overseas in India in 2010 but its role has been limited to engineering, material requirement and inspection-related activity, according to the company website.
“Aramco’s office in New Delhi will be similar to the one in Tokyo and Seoul which also look into supply of oil to these countries,” said a second source.
The sources did not want to be named as they were not authorised to speak to media.
India will be the fifth country in Asia where the state-owned oil company Aramco will set up offices after Korea, Japan, China and Singapore. It also has Aramco services company in the United States and Aramco Overseas company in Europe.
Aramco’s push into India comes at a time when fuel demand in the country is rising, driven by the government’s focus on local manufacturing, infrastructure development and rising car sales. Below average monsoon rains are also pushing up demand for diesel used in gensets to pump water for irrigation.
Kuwait Petroleum Corp also has an office in India that looks into crude sales to the country. (Reporting by Nidhi Verma; Editing by Himani Sarkar)