The proposed Saudi Aramco IPO seems increasingly unlikely to actually take place, in my opinion.
The Aramco IPO of 5% of the "family jewels" was originally heavily promoted to be listed on the New York, London or Hong Kong stock markets. But those locations fell through with a resounding thud. Despite media chatter, those key financial hubs seem clearly not suitable for the Aramco IPO. Due to lack of transparency by Aramco, and also the very real threat of litigation against Aramco, especially in New York.
So last year, Aramco tried bypassing these 3 international markets, and tried floating the idea of selling the 5% stake directly to state players China and then to Russia. Clearly, neither China nor Russia were seriously interested in directly purchasing a 5% stake in Aramco. My guess would be lack of transparency by Aramco regarding their actual proven reserves and actual, proven decline rates.
With China going great guns in recent years to acquire secure energy sources from countries and National Oil Companies around the world, it speaks volumes to me that China turned down the offer to acquire an exclusive 5% stake in Aramco, which is by far the biggest oil company in the world.
China has invested heavily over the years in Venezuela's National Oil Company PDVSA. And PDVSA is currently a complete basket case, a corroding disaster, circling the drain.
So China has thrown money left, right and center to PDVSA, but won't touch an offer from Aramco for 5% of Saudi Arabia's "family jewels" - Aramco.
Think about that for a minute. Seriously.
Russia also politely snubbed Aramco's offer of an exclusive 5%. And Putin is no dummy.
So ... then KSA had the bright idea to list the world's largest IPO on their own, tiny, Saudi Arabia stock market. Bad idea. The local Saudi exchange is clearly not transparent enough for international investors to dump USD $2 trillion (supposedly) for the Aramco IPO.
And that idea clearly didn't work, as it has come full circle again. Media are once again chattering about the idea of an Aramco IPO being listed on the New York, London, or Hong Kong exchanges. That idea fell through the first time around ... what's Einstein's definition of insanity again ... ?
Oh, and that USD $2 trillion valuation? Without transparency about the actual, proven reserves and actual, proven decline rates of Aramco's massive oil assets, then that number is reminiscent of the Emperor's New Clothes - try not to gawk in disbelief.
With water cut at 40% or 60% in some cases on Aramco's aging oil wells, with Enhanced Oil Recovery activities going on for years now, with China and Russia unwilling to purchase an exclusive 5% stake in Aramco, and with Al-Naimi, the former longtime head of Aramco leading the charge for renewable energy in the Kingdom, it seems increasingly unlikely that a Saudi Aramco 5% IPO with a valuation of USD $2 trillion will ever see the light day.
Maybe if the significantly over-valued $2 trillion valuation gets chopped in half, and Aramco fully opens their books to investor scrutiny, then - and only then - does a Saudi Aramco IPO have a chance to succeed.
Since the Aramco books remain firmly closed as an official State Secret, and since the brash, young Crown Prince MbS won't back down about a $2 trillion valuation, I'm not holding my breath.
Just my opinion; as always, you are free to disagree.