- Saudi Aramco started marketing its first dollar-denominated Islamic bond sale.
According to a person familiar with the matter, who asked not to be identified as government-controlled sukuk the details are private.
The company is raising cash to help fund its plans to pay out $75 billion in dividends. An initial engagement the oil company made to garner support for its initial public offering. Aramco had to reduce spending, close jobs and sell non-core assets as the spread of coronavirus and widespread lockouts curbed demand for oil last year, the main source of revenue for Saudi Arabia.
The price of Brent crude has rebounded after being at one point plunged to a 21 year low of just below $16 a barrel in 2020. It's since risen to over $70 a barrel four-fold in the past two years.
Oil Crown Jewels Are No Longer On Limits With Deals Ramping Up.
And while Aramco's first-quarter profits fell short of the 18.5 billion needed to pay the dividend for the period due to the recovery in both crude and gas.
Aramco's oil revenues account for about 40% of the Kingdom's gross domestic product and the recent increase in crude prices may drive this even higher, wrote Bloomberg Intelligence analysts Jaimin Patel and Damian Sassower in a note Tuesday. According to Saudi Arabia's plan to reduce its dependence on Aramco, Saudi Arabia's fiscal deficit will be challenged by the country's fiscal deficit, they said.
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