Saudi Arabian state-backed oil company Aramco is nearing agreement with international banks on a $10 billion loan that would bolster its finances as conflicts in the Middle East threaten crude exports.
The revolving credit facility that is set to be signed in the coming weeks will be provided by banks including Bank of China Ltd., Citigroup Inc., HSBC Holdings Plc, Industrial & Commercial Bank of China Ltd., JPMorgan Chase & Co. and Mitsubishi UFJ Financial Group, according to people with knowledge of the matter.
Saudi Aramco has benefited from a surge in oil prices during the Iran war and as it revived exports and production from a decline during the initial days of the conflict. But the company, the backbone of the Saudi economy, has faced attacks on its infrastructure in recent weeks, with Yemen’s Houthi militants targeting its headquarters, a major oil field, at least one refinery and the key port on Yanbu on the Red Sea.
The new facility is set to be priced at 60 basis points over the Secured Overnight Financing Rate, said the people, who asked not to be identified discussing a confidential process.
Spokespeople for Citi, HSBC, JPMorgan, Mitsubishi UFJ Financial Group, Standard Chartered and Aramco declined to comment. A representative of Bank of China wasn’t immediately available for comment. A spokesperson for Industrial & Commercial Bank didn’t immediately respond to a request for comment.
Gulf energy companies have been looking to tap debt markets for large-scale financing. QatarEnergy raised a $3 billion loan this month largely from a roster of Chinese banks. Saudi Energy Co. also raised a 15.8 billion riyal ($4.1 billion) Shariah-compliant murabaha financing in July, with a group of seven Gulf banks providing the facility.
Aramco signed its previous revolving credit facility in 2024. The facility consisted of two tranches, one for $7 billion arranged by US, European and Asian lenders, and a second tranche for $3 billion, a murabaha facility, that was funded by regional banks.
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