• 3 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 7 minutes Middle East on brink: Oil tankers attacked off Oman
  • 11 minutes Is $60/Bbl WTI still considered a break even for Shale Oil
  • 15 minutes CNN:America's oil boom will break more records this year. OPEC is stuck in retreat
  • 24 mins The Pope: "Climate change ... doomsday predictions can no longer be met with irony or disdain."
  • 3 hours Coal Boom in Asia is Real and a Long Trend
  • 33 mins Hydrogen FTW... Some Day
  • 40 mins China's President Xi To Visit North Korea This Week
  • 4 hours OPEC, GEO-POLITICS & OIL SUPPLY & PRICES
  • 3 hours Forbes: Giant Floating Solar Farms Could Extract CO2 From Seawater, Producing Methanol Fuel.
  • 14 hours Greenpeace claims one oil rig is "pushing the world closer to a climate catastrophe"
  • 7 hours Why Is America (Texas) Burning Millions of Dollars Per Day Of Natural Gas?
  • 7 hours Fareed Zakaria: Canary in the Coal Mine (U.S. Dollar Hegemony)
  • 9 hours As Iran Nuclear Deal Flounders, France Turns To Saudi For Oil
  • 5 hours Hormuz and surrounding waters: Energy Threats to the World: Oil, LNG, shipping markets digest new risks after Strait of Hormuz attack
  • 4 hours The Magic and Wonders of US Shale Supply: Keeping energy price shock minimised: US oil supply keeping lid on prices despite global risks: IEA chief
  • 19 hours Britain makes it almost 12 days with NO COAL
  • 10 mins Russia removes special military forces from Venezuela . . . . Maduro gone by September ? . . . Oil starts to flow ? Think so . .
Alt Text

Climate Change Could Trigger Global Financial Crisis

A top U.S. financial regulator…

Alt Text

Energy Majors Face Off To Get A Piece Of This $40 Billion Deal

International energy companies are descending…

Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Trending Discussions

Saudis Turn To Capital Markets For $10 Billion Loan

Saudi Arabia is seeking a $10 billion loan from international banks, according to Reuters, which represents the country’s first major loan in more than a decade.

The Saudi government is hoping to discuss the matter with several unnamed banks, and while the amount was also not disclosed, a source told Reuters that it could top $10 billion. Related: In Risky Move Wall St. Backs Shale With Nearly $10 Billion In Equity

To be sure, Saudi Arabia has a massive pile of foreign exchange that will allow it to weather the oil price downturn for years, although few expect oil prices to remain below $40 for that long. Still, the Saudi government surely does not want to burn through all of its cash reserves. In fact, Saudi reserves dropped below $600 billion for the first time in almost four years. The OPEC member burned $14.3 billion in January, the third month in a row that it used more than $10 billion. Is recently as the summer of 2014, Saudi Arabia’s foreign exchange sat well above $700 billion.

With oil prices so low, Saudi Arabia estimated in late 2015 that it ran a budget deficit of $98 billion for the year. The trajectory is unsustainable. S&P downgraded Saudi Arabia’s credit by two notches in February, from A+ to A-. Related: The U.S. Still Dominates World Oil Prices

It now appears that the Saudi government wants to turn to international lenders to help plug the budget hole. As one of the world’s largest oil producers with a huge war chest of cash reserves, Saudi Arabia shouldn’t have trouble finding any lenders. Not only that, but Reuters says that banks might be eager to lend to Saudi Arabia because it could improve their chances of being selected to conduct the bond offering that Saudi Arabia is planning on holding later this year.

Still, borrowing costs will likely be much higher than what would have been offered a year or two ago. For example, Qatar took a $5.5 billion loan from international lenders in January, much lower than the expected $10 billion that was anticipated, reportedly because the offered interest rates were too high.

By Charles Kennedy of Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage

Trending Discussions


Leave a comment
  • Brett Miller on March 03 2016 said:
    Really? That's like saying my business has $600,000 in the bank but I want to borrow $10,000. And I have the ability to manipulate my business market sector such that I could increase my revenue stream per unit by 200% to 300% any time I want. Talk about having your cake and eating it too!

Leave a comment





Oilprice - The No. 1 Source for Oil & Energy News