N Vijayagopal, the finance director at India’s state oil company BPCL said that most of the Western countries would be wary of getting into China and India will be the only alternative. Hence, the country can take an opportunity to attract investments in the oil sector and push BPCL asset sale when the world emerges from the COVID-19 pandemic.
According to Vijayagopal, ExxonMobil, Shell, BP, and Saudi Aramco would have the cash to invest after the pandemic. Some major oil companies have already expressed an interest in BPCL as they see India, the world’s No.3 oil consumer with 1.3 billion and more population, as an attractive alternative to China.
Vijayagopal’s statement came as many world leaders, including US President Donald Trump, are coming together to dub China as a potential threat to the world’s security, trade, and human rights. However, ExxonMobil, Shell, Saudi Aramco, and almost other big oil companies have investments across China’s energy sector.
BPCL is India’s No.2 fuel retailer and No.3 refiner. Its market share stood at 21% in the financial year of 2018-2019. However, the demand and price destruction caused by coronavirus pandemic has pushed its value down to $5.7 billion from $7.4 billion in early February. According to Vijayagopal, BPCL’s value reduction is not a problem as suitors will assess the firm by its assets and ability to survive the crisis.
The Indian government plans to divest its total 53.29% stake in BPCL by this financial year, but it has delayed the deadline for initial bid submission twice to July 31 now.
