Saudi Aramco, the world’s largest oil company, has received $60 billion in orders for its debut bond sale, kickstarting an offering with yields likely to fall in line or below Saudi Arabia’s sovereign debt.
It’s rare for bonds of a state-owned company to yield less than the sovereign debt and the demand reflects intense investor appetite for high-quality paper. For Saudi Arabia and Aramco itself, the early success in selling the bonds marks a tremendous turnaround after investors, Wall Street bankers and corporate titans briefly shunned the kingdom last year following the assassination of journalist Jamal Khashoggi.
The crisis, along with sliding crude prices, hit the kingdom late last year and in early 2019, with the economy slowing down and investors taking money out of the local stock market. Now, the situation appears to be reversing, helped by oil rising to more than $70 a barrel, up from $50 in December.
