The largest energy company in the world, Saudi Aramco, is currently considering a possible offer for BP’s lubricant assets. The news comes as the Middle Eastern organisation moves to obtain further acquisitions that extend its reach to countries where oil is consumed.
The company is reviewing whether it should place a bid for all or part of the lubricant business that operates under the brand name Castrol.
Aramco already operates a lubricants unit under the Valvoline brand. It purchased the lubricant business back in 2023 for a deal worth $2.65 billion. Industry experts have suggested that if the company purchases Castrol, it may integrate it with Valvoline Lubricants.
Bloomberg News recently reported that BP is involved in a largescale corporate reshuffle to appease investors. As part of its aims, the British oil industry company is undertaking a strategic review of its Castrol lubricants unit. Analysts at Bloomberg estimated that the total value of Castrol is about $10 billion.
The Saudi oil company is especially interested in the BP-owned brand’s operations in fast-emerging markets such as India. The company’s Mumbai-headquartered Castrol India subsidiary has a current market value of approximately $2.5 billion.
Deliberations remain at the early stages, and no final decisions have been made by Aramco regarding the structure of a possible bid, or even if it will likely proceed. Aramco’s other industry activities include bidding on Shell service stations sited in South Africa; however, the window for a bid is limited, as reports also indicate that BP’s Castrol lubricant assets are attracting the interest of other potential buyers.
