LIVE TV
ZEE Business
ZEE BUSINESS
हिंदी में पढ़ें  हिंदी में पढ़ें
Live TV
Live TV
  • Home
  • Personal Finance
    • PPF
    • Mutual Funds
    • Income tax
    • EPFO
    • Income Tax Calculator
    • Personal Loan Calculator
    • Car Loan Calculator
    • Home Loan Calculator
    • SIP calculator
    • SWP Calculator
    • MF Returns Calculator
    • Lumpsum Calculator
  • India
    • Companies
    • Property
    • Startups
    • Uidai
  • Economy
    • Aviation
  • Tech
    • Mobiles
    • Apps
  • Auto
    • Cars
    • Bikes
  • Markets
    • Commodities
    • Currency
  • Jobs
  • Indian Railways
  • World
    • Economy
    • Politics
    • Markets
  • videos
  • photos
  • Authors
  • More ...
    • VIDEOS
    • PHOTOS
Read in App
Business News » World News

Exclusive: UAE state oil firm considers trading unit in reform push - sources

  • Twitter
  • Facebook
  • Linkedin
  • whatapp
  • View in App
Updated: Tue, Jul 11, 2017
07:51 pm
Reuters

Abu Dhabi National Oil Company (ADNOC) is looking to set up its own trading unit, possibly together with an oil major or a big trading house, joining other Middle East producers seeking to boost earnings via new revenue streams, industry sources said.

A sharp drop in crude prices since mid-2014 has forced the oil industry to cut costs and look for ways to boost efficiency amid competition from new producers such as U.S. shale firms.

The move by ADNOC, regarded as one of the most conservative among Middle East oil producers, is part of a wider shake-up at the state-run firm, which is seeking to become more competitive under a new management appointed last year.

On Monday, ADNOC said it could float some of its services businesses and partner global investors to help it secure better market access at a time when its budget is being stretched by low oil prices.

Four industry sources told Reuters ADNOC had held talks over the past year with oil majors Royal Dutch Shell and Total as well as the world`s biggest trading house Vitol on setting up a joint venture to trade oil and products.

Shell, Total and Vitol declined to comment. ADNOC declined official comment on plans for ventures.

Increasingly, Middle Eastern producers are looking into the viability of running their own trading firms. In May, trading sources told Reuters Iraq`s state oil marketer SOMO had teamed up with Russia`s LUKOIL in a venture in Dubai to market crude.

"ADNOC is exploring a potential establishment of a trading arm but the structure is yet to be decided," one industry source familiar with discussions said.

ADNOC has been studying whether to set up a unit such as Saudi Arabia`s Aramco Trading, which markets refined products, base oils and bulk petrochemicals, or follow the model of Oman, which trades both crude and products, industry sources said.

"It all fits with the ongoing transformation of the organisation to try to make it much more commercially focused to drive revenue and profit," the first source said.

Discussions, which have continued for several months, are focusing on the best trading model with majors and traders asking for an equity stake in a venture similar to a model used by Iraq and Oman. The other option would be to split profits without giving a foreign partner equity stakes.

"Western companies are less keen on profit sharing as there is no guarantee of profits in the first years of operations," a second source familiar with discussions said.

Oman was the first Middle Eastern producer to set up trading with a 50/50 venture with Vitol last decade. The venture, Oman Trading International, was ultimately bought out by the government and is currently fully owned by Oman Oil.

Last year, ADNOC reshuffled its leadership, in a major shake-up after the appointment of Sultan Al Jaber as chief executive. It consolidated the operations of two oil companies into a new entity, and its shipping, marine and services companies into one firm in order to increase efficiency.

ADNOC has output of around 3 million barrels per day, or around 3 percent of global production.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)

Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.

TAGS:

LATEST NEWS

L&T construction bags order in 'significant category ranging between Rs 1,000 crore and Rs 2,500 crore from Oilfields Supply Company Saudi

COVID-19: Hospitals in Delhi-NCR short on oxygen, send SOS to Govt - All details here

Google searches for oxygen cylinder, Remdesivir skyrocket in India! Check all details here

Apex Legends Mobile: Check release date, system requirements, pre-registration link, and other important details

Banking, Financial & Metal Stocks to ICICI Securities - here are the top Buzzing Stocks today

7th Pay Commission Latest News Today: BUMPER! Earn up to Rs 1.19 lakh as per 7th cpc matrix with HRA, DA, TA in this UPSC recruitment 2021 drive

KSET 2021 Postponed: Karnataka SET exam POSTPONED for 2nd time - check details here

PUBG Mobile 1.4 update: Check global version beta update APK download link for worldwide users

THIS foldable smartphone from Xiaomi to arrive in India soon - Check all details here

WhatsApp Pink - a new virus now threatens users accounts; find out what it is and how to stay safe

  • India News
  • World News
  • Companies News
  • Market News
  • Personal Finance News
  • Technology News
  • Automobile News
  • Small Business News
  • Income Tax Calculator
  • Live TV
  • Videos
  • Photos
  • Author
  • Rss Feed
  • Advertise with us
  • Privacy Policy
  • Legal Disclaimer

Latest Trending Updates

  • EPFO
  • Budget 2020
  • Income Tax Return
  • Auto Expo 2020
  • Home Loan
  • Business News

Trending Topics

  • Income Tax
  • income Tax Calculator
  • 7th Pay Commission
  • Reserve Bank of India
  • GST
  • Latest Business News

Follow us on

zeebiz
zeebiz

Partner Sites

  • Zee News
  • Hindi News
  • Marathi News
  • Bengali News
  • Tamil News
  • Malayalam News
  • Gujarati News
  • Telugu News
  • Kannada News
  • DNA
  • WION
Copyright © Zee Media Corporation Ltd. All rights reserved