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The largest oil company in the world, Saudi Aramco, changes hands. Khaled al-Falih, the current Minister of Energy, is losing his job to Yassir al-Rumayyan, the head of the Public Investment Fund. A choice that questions the Crown Prince Mohammed bin Salman as the Saudi giant prepares a highly anticipated IPO. It could be between the end of 2020 and the beginning of 2021. What does this decision hide? Pierre Terzian, director of the Petrostrategies review , explains .
Are the Saudi authorities' decisions paving the way for Aramco's next IPO ?
Pierre Terzian : The replacement of Khaled al-Falih at the head of the Saudi national oil company is mainly explained by this objective. An IPO that should be very small, 5%, they say. But that forces this company to follow a more financial management. While up to now, it was rather directed according to political and industrial considerations. The second point to note is that the Public Investment Fund, whose head takes the presidency of Aramco, will be the recipient of the sums that the IPO will release. It is also this fund that will invest these sums in development projects that the Crown Prince, Mohammed ben Salmane, called by his initials MBS, plans to launch to prepare his Vision 2030 plan.
► See also: Saudi Aramco, the most profitable company in the world in 2018
What role will it be given to the mining sector under this plan ?
According to MBS, the mining sector must be an increasingly important part of the revenues of the nation and the Saudi state. However, it seems he was unhappy with the progress of things in this sector. A sector that depended on Khaled al-Falih until recently. On Friday, August 30, the Ministry of Energy was split in two: on the one hand the Energy that remains under its leadership, and on the other the portfolio of industry and mines that was entrusted to someone another one. With the hope, no doubt, for MBS that this new minister will put more emphasis on the development of the mining sector.
Does the replacement of al-Falih at the head of Aramco hide a disavowal of Saudi power vis-à-vis this powerful minister?
The fact that he has been divested of half of his ministerial attributions, and that the presidency of Aramco escapes him, is certainly an act of disavowal on the part of the crown prince towards someone who was nevertheless very close to him. now. This is explained on the one hand by the unsatisfactory results in the mining sector, as I said, but it would appear that Khaled al-Falih's opposition to Aramco's IPO project ended annoy MBS who wants to carry out this operation at all costs. It should also be noted that the Department of Energy and Aramco's management team are not very supportive of this company's listing. Moreover, they think the timing is wrong because oil prices are down. And the stupendous figures that the Crown Prince has advanced when he first announced this financial operation will certainly not be realized. So, yes, there is a share of disavowal of the crown prince in the change at the head of Aramco.
► See also: Oil: Why the fact that Saudi Aramco publishes its results challenges