Saudi Aramco shares hit post-listing low

DUBAI: Shares of Saudi Aramco opened at 34 riyals (RM37) yesterday, their lowest level since the oil giant began trading on Dec 11, after Iran launched missiles on US targets in Iraq.

At 0740 GMT, Aramco had recovered to 34.15 riyals, but were down 0.6% compared with Tuesday. The latest price valued the company at US$1.82 trillion (RM7.46 trillion), down from a peak of US$2.06 trillion on Dec 12.

Jason Tuvey, a senior emerging markets economist at Capital Economics, said the decline in Aramco’s share price in the final couple of weeks of last year was a case of reality kicking in among investors, but the recent weakness was due to geopolitical tensions.

“In the past week, however, geopolitical tensions have been the main driver of the drop – investors are clearly concerned that Iran, or Iran-backed proxies, target Aramco’s infrastructure once again.”

The Sept 14 strikes had targeted the Abqaiq and Khurais plants at the heart of Saudi Arabia’s oil industry, temporarily shutting down 5.7 million barrels per day (bpd) of output – more than 5% of global oil supply.

The assault, which Riyadh blamed on regional foe Iran, shook oil markets and prompted the United States to deploy additional American military forces and hard-ware to bolster the kingdom’s defences. Tehran denied any involvement.

Aramco shares are down almost 12% from a peak of 38.70 riyals on Dec 12, but still above the initial public offering price of 32 riyals that valued the company at US$1.7 trillion.

Gulf stocks were in the red yesterday amid escalating tensions between the United States and Iran. Aramco said on Tuesday Goldman Sachs may stabilise its shares, but so far no price stabilisation transaction have occurred since the stock began trading. The stabilisation period ends today. – Reuters