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Reliance Industries, Saudi Aramco to reassess planned deal

By Anoop Agrawal

05:31, 22 November 2021

Crowd at a Reliance petrol pump in Katni district of Madhya Pradesh in India
Shares of Reliance Industries fall – Photo: Shutterstock

Shares of India’s Reliance Industries (RIL) fell 3.6% on Monday morning trade after the Indian multinational conglomerate and Saudi Aramco announced on Friday they planned to reevaluate the proposed investment by the latter in RIL’s oil-to-chemicals (O2C) business. 

“Due to the evolving nature of Reliance’s business portfolio, Reliance and Saudi Aramco have mutually determined that it would be beneficial for both parties to re-evaluate the proposed investment in O2C business in light of the changed context,” the firm said in an exchange filing on 19 November.

Reliance Industries and Saudi Aramco had signed a non-binding letter of intent in 2019 under which the Saudi state-owned company was to purchase a 20% stake in the oil-to-chemicals business of Reliance Industries for $15bn. 

RIL said that following the development, the company would withdraw the application made before the National Company Law Tribunal for segregating the O2C business from RIL.

Committed to collaboration

India’s largest firm by market cap said it will remain Saudi Aramco’s preferred partner for investments in the private sector in India and will collaborate with Saudi Aramco for investments in Saudi Arabia.


16,039.00 Price
+0.090% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 1.8


2,043.71 Price
+0.050% 1D Chg, %
Long position overnight fee -0.0191%
Short position overnight fee 0.0109%
Overnight fee time 22:00 (UTC)
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38,210.80 Price
+0.470% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 22:00 (UTC)
Spread 106.00


0.62 Price
+0.130% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.01168

“Saudi Aramco and Reliance are deeply committed to creating a win-win partnership and will make future disclosures as appropriate. Both companies are committed to collaborate and work towards strengthening the relationship further in the years ahead,” the statement added.

For the past two years, the Mukesh Ambai-owned firm was in the process of selling a 20% stake in its oil business to Aramco, as announced by the chairman in June at the shareholders’ meeting.  

RIL had also unveiled plans for clean energy and materials businesses and announced the development of a facility in Jamnagar, the site of Asia’s largest refinery with 60 million tons per annum capacity, making it one of the largest integrated renewable energy manufacturing facilities in the world.

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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