Copyright © BusinessAMBE 2023
Key takeaways
- Saudi Aramco wants to expand global oil storage.
- PIF and Aramco have committed nearly 180 billion euros to European projects.
- Strict regional regulation poses a threat to future Saudi investments in Europe.
After supply disruptions in the Strait of Hormuz as a result of the conflict with Iran, Saudi Aramco is exploring options to expand its global oil storage capacity.
Aramco looking to increase global storage capacity
During the FII PRIORITY Europe summit in Rome, Yasir Al-Rumayyan, chairman of Aramco and governor of the Saudi Public Investment Fund (PIF), noted that although the company already has facilities in Asian markets such as Japan and South Korea, there is a strong intention to further expand storage capacity internationally.
The event was organised by the Future Investment Initiative, backed by the PIF, the same organisation responsible for the flagship annual summit in Riyadh, often referred to as “Davos in the desert”.
Financial commitments in Europe
In his speech, Al-Rumayyan elaborated on the considerable financial presence of Saudi interests in Europe.
He stated that between 2017 and 2025 the PIF has committed around 98 billion euros to projects in the United Kingdom and Europe. In addition, Aramco has allocated about 80 billion euros to various European suppliers.
Stringent regulations
The chairman did, however, stress that strict European regulation forms a significant obstacle to these undertakings. He warned that such regulatory hurdles not only discourage new capital injections from entities such as SABIC, PIF and Aramco, but also jeopardise the stability of existing investments.
Although Al-Rumayyan expressed hope that European policymakers are currently reviewing these issues in order to find more favourable solutions, he emphasised that the current environment remains challenging for investors.
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