Saudi Arabia’s oil company Aramco has started the sale of a second round of US dollar-denominated sukuk bonds, according to a filing to the Saudi stock exchange.
The company is planning to raise up to $3 billion through the issuance of five and 10-year sukuk, or Islamic bonds, sources with direct knowledge of the matter told Reuters.
The issuance is the company’s second dollar-debt sale of 2024. In July, Aramco raised $6 billion from its first bond issuance in three years. With this return to the debt markets, Aramco is joining top companies and governments in the Gulf that have tapped markets this year to fund investments.
Saudi government and state-linked companies have recently increased their borrowing, as the country looks to fund projects in Crown Prince Mohammed Bin Salman’s ambitious economic diversification push. Aramco plays a key role in those plans as the state relies heavily on the company’s dividends to help cover an expected budget deficit.
In January, the Kingdom issued $12 billion in dollar-denominated bonds as part of this trend. In May, Aramco completed the sale of approximately $12 billion worth of shares in its national oil company. Earlier that year, the oil giant reported a net income of $121.3 billion for 2023, the second-highest in the company’s history.
Aramco is set to pay out $124 billion in dividends this year.
