NEWS COMMENTARY

Saudi Aramco acquires 70% stake in SABIC for $70 billion, a move that will potentially power Saudi Arabia's Vision 2030

Published:
April 01, 2019
Coverage:
Owning the Energy Transition
Activities:
Acquisition
by Harshit Sharma
Very important

Saudi Aramco's $69.1 billion move has been coming and is an example of the size of investments oil companies will make to maneuver the energy transition. Aramco's move insulates it from the volatility of the transportation fuel market as electric vehicles grow in penetration while also giving it a foothold in the commodity chemicals market. The deal will not be emulated by any of Aramco's peers in the near future, primarily due to the weight of investment and the potential threat of oversupply in the chemicals space as Aramco invests $500 billion in the decade ahead. What remains to be seen is where the Saudi Public Investment Fund invests this capital. Similar to the Norwegian oil fund, it will likely be diversified into non-oil sectors.

For the original news article, click here .


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