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.”
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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