• 6 hours Investors Apprehension Makes $3,000 Gold Seem Feasible
  • 1 day Beijing Just Turned Up The Heat In The Tech War
  • 2 days How Big A Threat Is Climate Change To The Global Economy?
  • 3 days $120,000 Banana Gets Eaten At Art Basel
  • 4 days The Fastest Growing Energy Sectors Of 2019
  • 5 days How To Spy On Yourself: The Doorbell To End Civil Liberties
  • 6 days Analyst Predicts Tesla Stock Will Soar To $500
  • 7 days Australian Billionaire To Invest In $88 Million Struggling Solar Project
  • 8 days Twitter-Shaming: The Biggest Threat To Any Business
  • 8 days Canada Looks To Become A Major Source For Critical Minerals
  • 8 days Hedge Funds Are Piling Into This Key Commodity
  • 10 days Trade Deal Not Likely Before Christmas 2020
  • 10 days America's $16 Trillion Debt Bubble Is About To Burst
  • 11 days Black Friday Breaks Online Shopping Records
  • 11 days Tesla's Biggest Competitor Is Hiding In Plain Sight
  • 12 days Are Celebrities Good Or Bad For Cannabis Stocks?
  • 13 days Venezuela’s Crisis Continues As Maduro Spends $5 Billion On Oil Deals
  • 14 days Elon Musk Claims 250,000 Orders For Cybertruck
  • 15 days How To Survive Thanksgiving Politics With Cannabis Gravy
  • 16 days The Fragility Of Monetary Policy
Here We Go Again: Another Giant Telecoms Mega-Merger

Here We Go Again: Another Giant Telecoms Mega-Merger

Data and historical precedents suggest…

Will Japan Turn Its Back On The Aramco IPO?

Will Japan Turn Its Back On The Aramco IPO?

Japanese firms will probably stay…

Oilprice.com

Oilprice.com

Writer, OilPrice.com

Information/Articles and Prices on a wide range of commodities: We have assembled a team of experienced writers to provide you with information on Crude Oil,…

Contact Author

  1. Home
  2. Investing
  3. Other

World's Largest IPO At Risk Following Drone Strikes

IPO At Risk

The weekend attacks on key oil infrastructure in Saudi Arabia have investors anxious as the Kingdom has just accelerated plans to list Saudi Aramco in what would be the world’s largest initial public offering (IPO) ever.

Despite the world-class assets and the fact that Saudi Aramco pumped just below 10 million bpd before the attacks—or more than the world’s top four listed oil companies combined—financial analysts and investors tell Bloomberg that the valuation of the company may not fully account for major supply disruptions like the current one.  

“They are the best assets in the world but I have no interest in owning Aramco given the security risks,” Ben Cleary, Asia chief executive officer at Tribeca Investment Partners Pty, told Bloomberg, noting that the geopolitical risks in the Persian Gulf and risks of more attacks on critical Saudi oil infrastructure wouldn’t go away anytime soon.

On Saturday, the Abqaiq facility and the Khurais oil field in Saudi Arabia were hit by attacks, which resulted in the suspension of more than half of Saudi Arabia’s oil production.

Terrorist attacks with projectiles resulted in production suspension of 5.7 million barrels of crude oil per day, Saudi Aramco said on Saturday, confirming the loss of more than half of the Kingdom’s oil production.

Oil prices shot up on Monday after markets reopened following the attacks, while analysts say that the price movement in the next few days will be determined by how fast and how much of the oil production Aramco can restore.

According to analysts, the longer the timeline for Aramco to restore crude oil production, the more bullish this will be for the price of oil. Ironically, Saudi Arabia needs around $80 a barrel Brent Crude to rebalance its budget and a fairly high oil price to get as high a valuation for Aramco in the IPO as it can.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment