Tuesday, October 17, 2017

China Wants To Buy An Enormous Stake In Saudi Arabia's Main Oil Company Directly

Reuters: Exclusive: China offers to buy 5 percent of Saudi Aramco directly - sources

DUBAI/LONDON (Reuters) - China is offering to buy up to 5 percent of Saudi Aramco directly, sources said, a move that could give Saudi Arabia the flexibility to consider various options for its plan to float the world’s biggest oil producer on the stock market.

Chinese state-owned oil companies PetroChina (0857.HK) and Sinopec (0386.HK) have written to Saudi Aramco in recent weeks to express an interest in a direct deal, industry sources told Reuters. The companies are part of a state-run consortium including China’s sovereign wealth fund, the sources say.

Saudi Arabia’s Crown Prince Mohammed bin Salman said last year the kingdom was considering listing about 5 percent of Aramco in 2018 in a deal that could raise $100 billion, if the company is valued at about $2 trillion as hoped.

“The Chinese want to secure oil supplies,” one of the industry sources said. “They are willing to take the whole 5 percent, or even more, alone.”

Read more ....

WNU Editor: If this deal goes through, it will be seen as major geopolitical shift by historians in the future. Saudi Arabia is clearly pursuing/exploring a foreign policy that will be independent from the U.S. and the West. Overtures to Moscow, now this potential purchase of a major stake by China in Saudi Aramco .... I was always afraid that when the U.S. started (and brokered) a nuclear deal with Iran, it would alienate Saudi Arabia in ways that we can only imagine. Well .... we do not need to imagine any more. Saudi Arabia's intentions to form an alliance with China and Russia are now very clear .... they need reliable allies to offset Iran, and this is the strategy that they are pursuing. Bottom line, if successful the Middle East as we know it will probably be a very different place a few years from now.

More News On Reports That China Has Offered To Buy An Enormous Stake In Saudi Arabia's Oil Company Directly

Saudi Arabia reconsiders Aramco share sale -- Financial Times
Saudi Aramco denies FT report, says IPO on track -- The Star Online
Aramco Says No Plans To Shelve IPO -- OilPrice.com
Oil Rally Threatened As China Reportedly Offers To Buy Aramco Stake Directly -- Zero Hedge
Fiscal woes, Aramco IPO driving Saudi oil policy: analysts -- The Daily Star
Saudi Arabia Needs Lots of Private Oil Money -- Chris Hughes, Bloomberg

6 comments:

jac said...

Thanks Obama.

Jay Farquharson said...

Actually, the Saudi's desperately need the money, so now they are selling off nationalized assets to foreign nations.

War News Updates Editor said...

This sale would only finance 5 months of the Saudi budget. https://www.cnbc.com/2016/12/22/saudi-arabia-cuts-2016-budget-deficit-to-boost-2017-spending.html
The Saudis are looking at this sale from a geopolitical perspective .... to have powerful investors who will also be invested in the security of Saudi Arabia .... that is their priority .... not to pay a few bills.

Jay Farquharson said...


The Saudi Arramco IPO is guesstimated to be able to pull in $100 billion dollars, almost 6 months of their 2017 Budget,

https://www.google.ca/amp/s/amp.theguardian.com/world/2017/sep/02/great-saudi-sell-off-bankers-lawyers-flocking-gulf

and the Saudi State will still get royalties from every barrel of oil pumped and cubic metre of gas.

The Saudi's been running a deficit budget, for the past 4 years, and the big "benifit's" slash they tried, had to be rolled back because of domestic unrest.

Anonymous said...

Saudi arabian leadership is not united like before.
There is a feud between crown prince mohammad bin salman and previous crown prince mohammad bin Nayef.
I think it will playout once King Salman dies.

jimbrown said...

This will create a balance of power in the Middle East of SA Chins vs Iran Russia.

Meanwhile we can stand back and observe from afar.

Exactly as we planned.