Selling Saudi Aramco shares: a financial service to avoid

The document analyzes the June 2024 sale of 1.55 billion Saudi Aramco shares, classifying it as a Secondary Share Offering (SSO) where funds benefit the Saudi government rather than the company. While distinguishing SSOs from Primary Share Offerings (PSO) that provide direct capital for expansion, the author argues that financial institutions should avoid both to prevent supporting fossil fuel developers and increasing the attractiveness of oil and gas stocks.

• In June 2024, Saudi Arabia and Saudi Aramco conducted a sale of 1.55 billion shares, the largest stock market transaction in the Middle East since the 2019 IPO, supported by over 20 financial institutions including UBS, HSBC, and BNP Paribas.
• The Saudi Aramco transaction is classified as a Secondary Share Offering (SSO) because the shares were sold by an existing shareholder—the Saudi kingdom—meaning the funds go to the government for economic diversification rather than to the company for capital expansion.
• Financial institutions should urgently ban support for Primary Share Offerings (PSO), bond issues, and loans for any energy company that continues fossil fuel expansion, as these provide the capital necessary for growth and acquisitions.
• Although SSOs are financially neutral for the company, they are considered problematic because banks acting as bookrunners promote fossil fuel stocks to clients, thereby increasing the attractiveness of oil and gas stocks on financial markets.
• The document asserts that Saudi Aramco is the company developing the most new oil and gas projects, which contradicts the International Energy Agency's (IEA) Net Zero Emissions (NZE) scenario and trajectories to limit warming to 1.5°C.

APA

Martin, L. (2024). Selling Saudi Aramco shares: a financial service to avoid. Reclaim Finance. https://reclaimfinance.org/site/en/2024/06/21/selling-saudi-aramco-shares-a-financial-service-to-avoid/

Chicago

Martin, Léo. Selling Saudi Aramco shares: a financial service to avoid. Reclaim Finance, 2024. https://reclaimfinance.org/site/en/2024/06/21/selling-saudi-aramco-shares-a-financial-service-to-avoid/.

Wikipedia

{{cite press release |last1=Martin |first1=Léo |title=Selling Saudi Aramco shares: a financial service to avoid |publisher=Reclaim Finance |date=21 June 2024 |url=https://reclaimfinance.org/site/en/2024/06/21/selling-saudi-aramco-shares-a-financial-service-to-avoid/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{martin2024selling, author = {Martin, Léo}, title = {{Selling Saudi Aramco shares: a financial service to avoid}}, publisher = {Reclaim Finance}, year = {2024}, month = jun, url = {https://reclaimfinance.org/site/en/2024/06/21/selling-saudi-aramco-shares-a-financial-service-to-avoid/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }