Saudi Arabia plans $10bn bond issue
Country is seeking funds to shore up public finances that have been hit by the drop in oil prices to about half their 2014 levels
Oil rose to the highest in more than a year on Monday after Saudi Arabia expressed optimism that Opec would work out a deal and Russia voiced its support. Photograph: Karen Bleier/AFP/Getty Images
Saudi Arabia, the biggest oil exporter, sees its crude reserves of 266.5 billion barrels lasting 70 more years and hasn’t sought an independent consultant to review the figures, according to a bond prospectus.
The nation’s wealth is based mainly on oil, with crude sales accounting for 75 percent of total export earnings, according to the prospectus.
Saudi Arabia plans to sell at least $10 billion (€9.05 billion) in bonds maturing in five, 10 and 30 years, and it disclosed plans to hold investor meetings in London, Los Angeles, Boston and New York starting on Wednesday.
The country is seeking funds to shore up public finances that have been hit by the drop in oil prices to about half their 2014 levels.
At the same time, the kingdom plans to wean itself off dependence on oil for state revenue by selling part of its state oil company to help develop industries including auto manufacturing and technology.
Russia’s biggest producer Rosneft said it won’t cut output, according to Reuters, after president Vladimir Putin said at a conference in Istanbul his country is willing to join efforts by Opec to stabilise the market through a production freeze or cut.
Price declines accelerated as the dollar climbed, curbing the appeal of commodities. Oil rose to the highest in more than a year on Monday..
Brent for December settlement dropped 96 cents, or 1.8 per cent, to $52.18 a barrel on the London-based ICE Futures Europe exchange.