Reuters

Posted: 12 December 2019

Saudis hail ‘fortune-telling’ prince for Aramco price prediction

 

Saudis took to Twitter to celebrate Aramco’s valuation hitting $2 trillion on Thursday, with one posting praising de-facto leader Crown Prince Mohammed bin Salman as a fortune teller…

Some market professionals have called the IPO as the biggest migration of private sector money to government pockets, but the government plans to locally invest most of the 96 billion riyals raised, its finance minister said this week.

Yet while the government hails the listing as a milestone for delivering on promises to diversify the economy, a potential drop in Aramco’s share price risks shaking domestic support.

The danger is that if this doesn’t prove to be long-term sustainable and the share price starts reversing, the easy popularity can disappear as fast as it comes,” said Charles Hollis, director at intelligence consultancy Falanx Assynt.

It’s clearly good for the crown prince but we have to see whether it lasts,” Hollis said, adding that it would not solve unemployment or poverty in some parts of the kingdom.