Saudi Aramco’s stock recorded a marginal decline – the first in 7 consecutive sessions – during trading today, Monday, on the Saudi Stock Exchange.
The decline came despite Aramco announcing huge deals to increase its investments in the refining and petrochemical sector in China, the world’s largest oil importer.
During the past 24 hours, Saudi Aramco revealed deals worth more than $15 billion to increase investments in the Chinese refining sector.
Aramco share price
Today, Monday, March 27 (2023), the share price of Saudi Aramco recorded the first decline in 7 consecutive sessions, affected by the conditions of global financial markets, despite the rise in oil prices.
Aramco’s share decreased by the end of trading on the Saudi stock market “Tadawul”, by 0.16%, to record 32.10 Saudi riyals (8.55 US dollars), according to the data seen by the specialized energy platform.
The stock recorded transactions of approximately 5.3 million shares, with a total number of deals amounting to 8.83 thousand, with a value of 170.5 million riyals ($45.40 million).
* (One US dollar is equivalent to 3.76 Saudi riyals)
Aramco stock analysis
Hanan Ramses, an expert in financial markets in Egypt, says that the huge deals announced by Aramco come within the Kingdom’s plans to develop all revenue-generating sectors, whether oil, energy or non-oil sectors. To ensure the diversification of funding sources supporting the realization of the Kingdom’s Vision 2030.
She indicated the Saudi oil giant’s interest in developing cooperation and opening new markets that add gains and profits to the world’s leading oil and energy company.
This comes after Aramco’s business results showed a significant jump in profits, the highest since 2017, with the rise in crude oil prices, which rose to the highest level in 14 years in the wake of the Russian-Ukrainian war.
Aramco shares received a significant boost, with net profits increasing over the past year by 46.4%, recording 604 billion Saudi riyals ($161.07 billion), compared to 412.4 billion Saudi riyals ($109.8 billion) in 2021.
The stock managed during the past days to withstand, despite the fears of a global economic recession hanging over the financial markets.
The financial market expert indicates that the news of the deals had a good impact on the performance of Aramco’s share, despite its closing low, as it recorded high levels that reached 32.4 riyals, while its lowest decline was at 32.05 riyals, near the opening level that recorded 32.10 riyals.
Hanan Ramses said that the stock moves between the highest levels of 35 riyals, and the lowest at the level of 30 riyals, noting that the positive news related to business results and new deals will support the performance of the stock on the near and medium levels.
Aramco deals
During the past 48 hours, Aramco’s stock received a number of positive news, led by the company’s acquisition deals and new projects in the refining and petrochemical sector in China.
Today, Monday, Aramco signed definitive agreements to acquire a 10% stake in Rongsheng Petrochemical Co., Ltd., at a value of $3.6 billion.
Today’s deal follows Saudi Aramco’s announcement, Sunday, March 26, of starting implementation of the Aramco Huajin project, which includes a huge integrated refinery and petrochemical complex in northeastern China, in the second quarter of 2023.
Under the new deals, Aramco will supply 480,000 barrels per day of Arab crude oil to Rongsheng’s Zhejiang Oil and Petrochemical Company (Zhejiang), under a long-term sales agreement.
Aramco, which owns 30% in Aramco Huajin, will also supply up to 210,000 barrels per day of crude oil feedstock to the new complex, which has a value of $12.6 billion.
Through the partnership with Rongsheng and the Aramco Huajin joint venture, Saudi Aramco will supply a total of 690,000 barrels per day of crude oil to higher downstream chemical facilities.
The Aramco Huajin project is Aramco’s second largest investment in the field of refining and petrochemicals in China.
Huajin Aramco Petrochemical Company will build and operate the complex, which will include an oil refinery with a processing capacity of 300,000 barrels per day and a cracker with an annual production capacity of 1.65 million tons of ethylene and two million tons of paraxylene.
Saudi Stock Exchange
The Saudi stock market, “Tadawul”, ended Monday’s session with a marginal increase, to continue its gains for the third session, with the support of the telecommunications sector, amid the decline of 3 major sectors, led by the energy sector.
Trading values on the Saudi Stock Exchange rose today to 6.95 billion riyals, compared to 4.06 billion riyals in the previous session, and trading volumes rose to 231.4 million shares, compared to 122.2 million shares, at the end of Sunday’s session.
3 major sectors bucked the trend, after witnessing a negative performance, topped by the basic materials sector, which fell by 0.67%, followed by the banking sector, down by 0.47%, and the energy sector, which declined marginally by 0.06%.
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