Oil Drops As WSJ Reports Aramco IPO "Almost Certainly Won't Happen"

Last we heard from inside the kingdom, the Aramco IPO had been put on hold, with inside sources telling the FT that plans for the IPO had been temporarily shelved, and that the process for selecting a venue for listing the shares had been put off until at least 2019. Then there were rumors about a private sale directly to some of the world's sovereign wealth funds - which would cutting out the investment banker middlemen who've been salivating at the prospect of winning a piece of the world's largest IPO.


But six months into 2018, with oil prices at their highest level in three-and-a-half years and President Trump pushing Saudi Arabia and the rest of OPEC to ramp up production to help quell rising crude prices, the Wall Street Journal has dropped what looks like a bombshell on the oil market.

The Aramco IPO, which would've likely been the biggest offering in history given the company's valuation, is almost certainly not going to happen. According to the paper's inside sources, the death of the IPO has been all but officially announced.

Furthermore, WSJ reported that the IPO would bring "unprecedented scrutiny" to the Kingdom's "Crown Jewel", according to Saudi officials.

"Everyone is almost certain it is not going to happen," said a senior executive at Aramco, speaking of the IPO.

Oil prices are sliding as expectations surrounding the offering had been one of the factors supporting crude prices.


Now we wait to hear from inside the Kingdom, as officials might feel pressured to deny the rumors since they're apparently impacting the price of crude in a way that's contrary to the Kingdom's interests.


MrNoItAll researchfix Thu, 07/05/2018 - 14:37 Permalink

That's why they won't IPO, and why in reality they NEVER really planned on going public -- because to do that, they would have to divulge TOP SECRET information relating to how much (economically) recoverable oil they have. And that amount is far below what they have been claiming for many years. If the oil-guzzling world found how much remaining oil SA really has, it would incite a global panic and the world as we know it would dissolve into chaos. That will happen anyway, but for now the lies and propaganda and money printing are pushing the inevitable reckoning forward, day by day.

In reply to by researchfix

MrNoItAll Bureau of compliance Thu, 07/05/2018 - 14:55 Permalink

And Iraq. And Iran. And Afghanistan. And...

The Saudi IPO was never anything but a well planned and executed propaganda ploy to support/lift the price of oil. The fact that this "NO IPO NO WAY" news is "leaking" out now tends to indicate that TPTB are in the process of giving up on keeping markets elevated. Together with "trade wars", it seems the global economy is being lead step by step toward the abyss. Better than stepping into it suddenly, I suppose.

In reply to by Bureau of compliance

shortonoil MrNoItAll Thu, 07/05/2018 - 17:12 Permalink

No one who has ever gotten close enough to an oil well to smell it is going to invest in Saudi fields. 29 of the Saudis 32 producing fields have been in decline at 3% per year for more than 5 years! $1 trillion for a big oil slick is a little high! MBS blew his cover on this supposed IPO, and the Saudis still need $90 oil to breakeven. As Mat Simmons said, "as goes Ghawar goes the world" which should clue one into what is taking place. SA is likely to be the next major producer behind Venezuela to go belly up. On the bright side, instead of dog and cat stew they can have camel steaks.

In reply to by MrNoItAll

Cloud9.5 MrNoItAll Thu, 07/05/2018 - 19:27 Permalink

The fact that oil is a finite resource shatters the myth that sustains the massive Ponzi scheme that keeps the lights on.   Mexico just had a revolution.  That revolution was in no small way driven by the exponential decline of its energy sector.  The water cut in Saudi oil is a sign of their decline.  The fact that they are exploring fracking is another tell.  High finance and manipulation is the only game in town.

“The prices of gasoline and other fuels, that would have been required to keep the Oil Industry in reasonable financial shape, have not been able to rise to the much higher level that would have been necessary for the petroleum industry to remain in a sound financial condition. However, it has been  politically necessary to have ever-greater volumes of cheap energy available to the public and to the industry serving the public. Politically, there has been no option but to continue to provide fuel at prices that cannot sustain the Oil Industry in a financial sound condition.”



In reply to by MrNoItAll

gregga777 Thu, 07/05/2018 - 14:45 Permalink

If I had oil fields just gushing free oil like Saudi Arabia supposedly has there'd be no fucking way that I'd invite in public shareholders with all their disclosure requirments, securities commissions, navel gazing analysts, quants poring over spreadsheets like they're young naked porn stars, etc. If I needed some cash I'd invite in some big banks, show them the books and let them fall all over their "picking up pennies in front of steamroller" dumb asses offering me 100-year loans at near zero interest rates. So, why does Saudi Arabia really want to bring Aramco public? 

oncemore1 Thu, 07/05/2018 - 15:37 Permalink

why should this reflect the rice finding?

Arabs want to sell the shares, but keep the control, so where is the point?

under such scenario, I would not expect ANY impact on the price.

SergeA.Storms Thu, 07/05/2018 - 16:00 Permalink

They figured out their loss of control and it did not balance for them.  Private negotiations with banks keep the oil and money flowing.  Until it doesn’t, but that’s at least 100 years.

Stan Smith Thu, 07/05/2018 - 16:15 Permalink

    The amount of information required by shareholders would make the House of Sauds head fucking explode.

    Probably about the time these whackos saw the actual paperwork -- or beforehand on legal advice -- they pulled out and when to being autocratic douchebags again.   Much more profitable for them.   

    Never mind the fact that 20,000 "Royals" income would have to end up on the books as well most likely.   Pretty sure that won't go over with the populace whos lifetime incomes wouldnt equate to a days of a lower-saudis-distant-cousins income.