The main source of income for Saudi Arabia is oil. It plays a huge role in the economy of the country due to the availability of the resource in high quantities in the country. It has long been the reason behind the strong political stance of the country and the good relation it has with super power countries. Yet, it was important for the country to take a step towards other alternatives to help reduce the risk of losing the oil. Hence, lately it was announced officially by the government that the country has a new vision, which is to invest in the natural gas field.
This main deal was to finalize a huge contract with the United States to purchase over 5 million tons of liquefied natural gas every year. This will be delivered through a project of natural gas in Texas which is yet to be developed. Aramco, which is the leading oil company in Saudi Arabia is focusing on taking part of the deal by adding cash to the Texas project, giving them almost 25% stakes.
This was commented on by the head of gas and power at S&P Global Platts, Ira Joseph by saying, “This is a major statement about the Saudis entering the LNG market and about how price competitive the outlook is for US gas We expect Saudi Aramco will use this volume to establish a global portfolio as it seeks to become a global gas player.”