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Oil Is Unlikely To Go Much Higher

Oil Is Unlikely To Go Much Higher

Oil prices have climbed throughout…

Saudi Aramco’s IPO Has Never Been Linked To Oil Prices, CEO Says

Contrary to what oil market observers have been saying for months, the plans for listing 5 percent in Saudi Aramco have never been connected to the state of the oil market and the price of oil, Aramco’s chief executive Amin Nasser told Al Arabiya TV on Tuesday.

“The offering since the beginning was never linked to the market or the condition of the market,” Nasser told the television on the sidelines of the Future Investment Initiative conference in Riyadh.  

“There is no doubt, oil market stability is very important and Saudi Arabia has a leading position in the oil market,” Aramco’s chief told Al Arabiya, as quoted by Reuters.

When Saudi Arabia started discussing plans to take a small portion of its oil giant public, oil prices were in the $40s or below, and the IPO “was not linked back then that the price should reach a certain level.”

Word on the street for months has been that Saudi Arabia and OPEC have been targeting a $60-ish price of oil to balance budgets and spur stronger appetite for Aramco’s IPO next year. But as the production cuts failed to lift oil prices to that level, reports and speculations started emerging regarding a possible delay of the Saudi plan to list 5 percent of Aramco.

Just a couple of days ago, Aramco’s Nasser intervened on that front too, saying that the IPO stayed on track for the second half of 2018, as planned.

Related: Falling Iraqi Exports Drive Oil Prices Higher

“We have always said that we will be listing in 2018, and to be more specific, in the second half of 2018,” Nasser said in the interview with CNBC on Sunday.

Over the past month, Saudi Aramco has consistently denied growing reports and speculation that it may postpone the highly anticipated IPO until 2019, or could completely forgo an international market listing and go for a private placement with sovereign wealth funds as investors.

By Tsvetana Paraskova for Oilprice.com

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