OPEC Russian roulette yields circular firing squad 6 Mar 2020 Moscow has rejected the cartel’s pleas for a supply cut to ease a virus-linked demand slump. Given the scale of the oil market imbalance, an inadequate deal was the best that could have been hoped for. But OPEC’s efforts to force the issue look like leaving everyone worse off.
OPEC readies knife for oil demand-slump gunfight 3 Mar 2020 The cartel and its Russian allies are set to curb crude supply again, to counter a virus-induced price fall. But even a 1 mln barrels per day cut may not do the job. To hike prices, OPEC needs Russia to prove helpful, Libya to stay troubled, and the coronavirus to not get worse.
Bezos-Saudi spat has e-commerce proxy war 3 Feb 2020 Tensions between Riyadh and the Amazon boss may seem a stateside phenomenon. Yet Saudi Prince Mohammed bin Salman and Jeff Bezos have backed different horses in the battle for the $34 billion Middle East e-commerce market. That implies risks for both sides.
Virus panic makes OPEC cat-herding even harder 28 Jan 2020 Oil prices have dipped below $60 a barrel on fears the coronavirus will hit growth. The Saudi-led producers group already has a job convincing the likes of Russia to keep supporting cuts agreed in December. The virus jitters might make others, such as Riyadh, want to double down.
Saudi Newcastle punt is not as silly as it sounds 27 Jan 2020 Riyadh’s wealth fund is mulling a 340 mln pound takeover of the English soccer club. It’s another eyebrow-raising move in Saudi’s efforts to diversify its economy. But a repeat of Abu Dhabi’s successful reboot of Manchester City could help repair the kingdom’s tarnished brand.
Saudi nuclear ambitions may further fray U.S. ties 14 Jan 2020 Riyadh could soon award tenders to build two nuclear reactors. Picking Russia’s Rosatom would heighten tensions with Washington, its traditional ally. And if the kingdom also lobbies for scope to create nuclear weapons, it would make for an awkward comparison with archfoe Iran.
Aramco’s war-risk snake trumps oil-price ladder 6 Jan 2020 The threat of U.S. sanctions on Iraq should boost the oil price, and the Saudi giant’s value. Yet its shares have slumped to their lowest level since trading commenced last month. That may be because the company’s operations are more likely to be a target for Iranian retaliation.
Aramco’s next stop will be bond, not stock, market 18 Dec 2019 Despite raising $25.6 bln from listing 1.5% of Saudi Aramco, Riyadh will want to flog more. But even if it can find a friendly foreign wealth fund, Saudi might still have to cut the price. An easier path would be to load Aramco up with debt and pay itself a fat special dividend.
Wait six months for Saudi Aramco’s true value 11 Dec 2019 The oil giant’s shares jumped 10% on its first day of trading. A $1.9 trln valuation reflects an oversubscribed book, likely helped by hedge funds looking for a quick buck and local investors who may be incentivised to buy. A less pumped-up price should emerge over time.
Aramco: the IPO that succeeded and failed 9 Dec 2019 The kingdom has got its $26 bln oil giant IPO away. But with a lower valuation, a smaller stake sale and a limited foreign investor roster, it’s a chequered achievement. With a crazy price target and a sceptical audience, Aramco’s float was flawed from the start.
E-book: Aramco’s flawed IPO 9 Dec 2019 The Saudi oil giant has got its $25.6 bln initial public offering away, but not with the valuation or investor base it initially hoped for. Breakingviews’ new e-book, which contains columns stretching back to 2017, explains how the world’s largest ever flotation came up short.
OPEC insures Saudi Aramco against first-day blues 6 Dec 2019 The oil producers club and allies will hold back 0.9 million barrels per day on top of an existing 1.2 million barrel cut. While only for three months, it’s a coup of sorts for de facto leader Saudi Arabia. And it means newly listed Aramco will start trading on a firmer footing.
Aramco IPO has dug Saudi an even deeper hole 5 Dec 2019 The oil giant’s oversubscribed $25.6 billion listing was supposed to bring in foreign cash to diversify the kingdom away from oil. In the process, it has loaded up local investors with overvalued stock. Saudis have in one sense wound up more leveraged to crude prices, not less.
Aramco IPO could disappoint Saudi on a new front 26 Nov 2019 The oil giant has takers for most of its $25 bln offer. Yet its 1.5% listing is too small to give the local bourse a big bump up in MSCI’s key emerging-markets index. The gap between the 5% listing originally touted equates to tens of billions of dollars of foreign money inflows.
Saudi bankers’ sweat will lubricate Aramco IPO 20 Nov 2019 The kingdom’s lenders are extending credit to domestic investors buying into the oil giant’s $25 billion float. That means locals could face hefty margin calls if Aramco shares slump. Bankers’ best sedative is that Riyadh has very strong incentives to prop up the price.
Aramco’s $1.7 trln price tag pleases almost no one 17 Nov 2019 The Saudi oil giant will offer shares below the $2 trln valuation originally sought by the kingdom’s crown prince. But selling just a 1.5% slice implies the price range is still too rich for foreign investors. The mega-IPO is moving closer towards being a largely domestic affair.
Aramco has first-class seat on oil-tanker Titanic 11 Nov 2019 The Saudi giant’s IPO prospectus confirms it’s much more profitable than peers. Aramco also says a slump in oil demand could increase its market share. Yet the uncertain impact of such a shift ought to loom, iceberg-like, in investors’ minds as they weigh the company’s worth.
Viewsroom: When the CEO breaks the rules 7 Nov 2019 McDonald’s has provided a map for other firms after ousting boss Steve Easterbrook over a consensual relationship with an employee. Elsewhere, Aramco’s IPO and Fiat Chrysler’s merger with Peugeot. Plus: Breaking Japan’s love of hard cash.
Cox: Aramco is an ESG investor’s worst nightmare 7 Nov 2019 The Saudi oil giant’s business model is predicated on humans continuing to spew CO2 into the atmosphere. Its governance makes WeWork look benign. Its monarchy is overly tolerant of human rights abuses and beheadings. Fund managers with a conscience should boycott the deal.
Aramco’s intrepid investors are hedged in two ways 4 Nov 2019 Buying into the Saudi oil giant’s IPO means owning a tiny part of a state entity, with no control. Yet its pledge to pay a chunky $75 bln dividend for five years means punters are really preferred shareholders. A large retail offer could also limit Riyadh’s scope for rogue moves.