Oil Giant Saudi Aramco Confirms Studying Share Offer
State-owned Saudi Aramco, the world’s largest crude oil producer and exporter, said Friday it is considering a public share offer.
The company “has been studying various options to allow broad public participation in its equity”, a statement said.
This would be through the listing on capital markets “of an appropriate percentage of the company’s shares and/or the listing of a bundle (of) its downstream subsidiaries,” it said.
“This proposal is consistent with the broad and progressive direction pursued by the kingdom for reforms, including privatization in various sectors of the Saudi economy and deregulation of markets, which the company strongly supports,” it added.
The statement comes a day after The Economist published an interview with Saudi Deputy Crown Prince Mohammad bin Salman who said a share offer was under review.
Saudi Aramco said that, after studying the options, the findings will be presented to the board of directors, which will make recommendations to the company’s Supreme Council.
The council is chaired by Prince Mohammad and has overseen Saudi Aramco since it was separated from the oil ministry last year.
The kingdom is confronted by unusual economic challenges caused by plunging global oil prices.
Last week, it reported a record deficit of $98 billion (90 billion euros) for 2015.
And it projected a shortfall of $87 billion this year, with crude prices currently around $34 a barrel, down from more than $100 early in 2014.
In an unprecedented departure from its decades-old generous welfare system, Riyadh’s budget last week announced rises in fuel, electricity, water and other prices.