(EnergyAsia, May 28 2012, Monday) — Saudi Arabia has made a major policy shift with its decision to venture into oil trading including paper trading and derivatives as this could violate conservative Islamic rules that prohibits speculation and gambling.
The world’s largest oil exporter and producer has long held out against trading, citing the potential for conflict with its religious beliefs.
Saudi Aramco has established Aramco Trading as the subsidiary to handle futures and paper trading to maximise profits and manage risks for its large oil and gas portfolio.
“We are shifting our mindset from that of a giant oil exporter to focus on adding value to products by trading,”
Speaking at a recent energy conference in Bahrain, Aramco Trading’s CEO Said al Hadrami said the group is aiming to “add value” to its assets through trading as much as 1.5 million b/d of products. Saudi Aramco is in the midst of doubling its refining capacity to eight million b/d that will mostly target the export markets.