Saudi Arabia’s Oil Giant Aramco Unveils New Stock Tranche

DUBAI, United Arab Emirates — Saudi Aramco, the world’s largest oil company, announced on Friday that it will offer a second tranche of its stock, worth billions of dollars, marking its first stock sale since its initial public offering (IPO) in 2019. This move is part of the kingdom’s broader strategy to diversify its economy away from oil.

Details of the Stock Offering

In a corporate disclosure, Aramco revealed that it will offer 1.545 billion shares, priced between $7.12 and $7.73 each. At the top end of this range, the shares would be valued at approximately $11.9 billion. Institutional investors will have access to the shares starting Sunday, with retail investors following on Monday.

Aramco’s Market Standing

With a market capitalization of $1.8 trillion, Saudi Aramco ranks as the sixth most valuable company globally, trailing behind tech giants Microsoft, Apple, NVIDIA, Alphabet (Google’s parent company), and Amazon. Since its 2019 IPO, only 1.73 percent of Aramco has been traded on Saudi Arabia’s Tadawul stock exchange. The new stock offering represents an additional 0.64 percent of the company’s shares.

Government’s Role and Economic Diversification

The Saudi government remains the principal shareholder of Aramco, channeling shares to the kingdom’s sovereign wealth funds. This strategy aligns with Saudi Arabia’s Vision 2030 initiative, aimed at reducing the nation’s reliance on oil by diversifying its economy.

Aramco’s Financial Performance

Despite a 12 percent decline in its share value since the beginning of the year, Aramco remains a powerhouse in the oil industry. Last year, the company reported a profit of $121 billion, though this was a decrease from its record earnings in 2022 due to lower energy prices.

Saudi Arabia’s vast, easily accessible oil reserves make it one of the most cost-effective regions for crude oil production. This intrinsic advantage continues to bolster Aramco’s profitability and market value.