As investors piled into the conglomerate lured by the Indian firm’s digital and retail forays, Reliance Industries Ltd. toppled Exxon Mobil Corp. to become the world’s largest energy company after Saudi Aramco. Controlled by Asia’s richest man and manages the world’s biggest oil refinery complex, rose 4.3% in Mumbai on Friday, taking its market value to $189 billion, while Exxon Mobil lost about $1 billion. Aramco, with a market capitalization of $1.75 trillion, is the world’s biggest company. Reliance’s shares have jumped 46% this year, while Exxon’s have fallen 39% as refiners across the globe struggled with a plunge in fuel demand.
Energy business accounted for about 80% of Reliance’s revenue in the year ended March 31, Chairman Mukesh Ambani’s plan to expand the company’s digital and retail arms has helped him attract $20 billion into the Jio Platforms Ltd. unit. That in turn helped add $22.3 billion to Ambani’s wealth this year.
Large-scale global oil demand destruction due to coronavirus — some 30 million barrels a day or a third of regular usage, in April— sent energy markets into a second-quarter tailspin, from which they’ve only recently started to recover. Worst-in-a-generation oil prices combined with OPEC production cuts, collapsing refining margins and millions of barrels of unsold crude have hurt big oil companies including Exxon and Chevron Corp.