Aramco to do 'heavy lifting' in Saudi fiscal adjustment - BofA | Reuters
Saudi oil giant Aramco will likely need to transfer significant amounts of money to the Saudi government and the sovereign fund, Public Investment Fund (PIF), as Saudi Arabia puts its finances in order after the coronavirus slump, Bank of America said.
Aramco - which listed in 2019 in a record $29.4 billion share sale - is likely to “do the heavy lifting” to boost state coffers and support mega-projects spearheaded by the PIF, BofA said in a research note.
“The medium-term fiscal adjustment relies on the strength of Saudi Aramco’s balance sheet through sustained high transfers to the sovereign and to the PIF.”
Saudi Arabia increased non-oil revenue last year. Aramco, in which the government still owns a 98.2% stake, still accounted for more than half its total income.
The world’s top oil exporter aims to diversify its revenue away from crude and create jobs in new economic sectors and the PIF is Crown Prince Mohammed bin Salman’s vehicle of choice for transforming the economy.
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