Saudi Aramco, the world’s largest oil company, is considering selling assets to free up cash as it grapples with lower crude prices, a slashed dividend, and an ambitious global expansion strategy, according to four sources familiar with the matter.
Why Aramco Needs Cash
💰 Dividend Cut: The state giant will reduce payouts by nearly 30% this year after oil prices hovered near 60/barrel∗∗—farbelowthe∗∗60/barrel∗∗—farbelowthe∗∗90+ needed to balance Saudi Arabia’s budget.
🌍 Global Expansion: Aramco is investing in Chinese refineries, Chilean fuel retail (Esmax), and U.S. LNG (MidOcean)—while signing $90B in preliminary deals with U.S. firms post-Trump’s visit.
📉 Profitability Pressure: The Saudi government is pushing Aramco to cut costs and optimize assets as the kingdom’s deficit widens.
What Could Be Sold?
🏗️ Non-Core Units: Aramco has stakes in aviation, construction, and sports—potential candidates for divestment.
🛢️ Infrastructure Stakes: Past sales (e.g., oil pipelines) suggest similar deals could recur.
💡 Bankers’ Role: Investment firms are pitching ideas, but no specific assets or banks have been named.
Broader Implications
⚖️ Saudi’s Fiscal Crisis: The IMF warns Riyadh needs $90+/barrel oil to break even—yet prices remain weak.
🔋 Diversification Drive: Asset sales could fund Aramco’s gas, LNG, and downstream ventures abroad.
🔄 Investor Sentiment: A dividend cut and fire sales may unsettle shareholders, but Aramco’s state backing limits risk.
What’s Next?
- Asset Selection: Will Aramco offload minority stakes or entire divisions?
- Market Reaction: Oil prices and Aramco’s $2T+ valuation hinge on execution.
- Geopolitical Angle: Sales could deepen ties with U.S./Asia partners amid OPEC+ turmoil.