Saudi Arabia buys stakes in four big European oil firms: source

09 April 2020 - 13:23 By Reuters
Saudi Arabia's Public Investment Fund has bought stakes in four major European oil companies.
Saudi Arabia's Public Investment Fund has bought stakes in four major European oil companies.
Image: Nicolò Campo/LightRocket via Getty Images

Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), has acquired stakes in four major European oil companies, a source familiar with the transaction said.

The four are Royal Dutch Shell, France's Total, Norway's Equinor and Italy's Eni, the source said, confirming a Wall Street Journal report.

The source did not confirm the combined value of the stakes, which the WSJ reported were worth $1bn (roughly R19bn).

"The Saudis have been buying every day almost for the past few weeks, especially since the share prices of many of these companies were in correction territory and dividend yields were very high," said the source familiar with the transactions," said the source.

"They've been buying on the basis that everything is much cheaper and that they are bullish on the long-term outlook for oil prices."

The PIF had also bought into other companies which do not require disclosure, the source added.

Equinor, Total and Shell declined to comment. The PIF did not reply to a request for comment.

The fund's purchases come during a global oil and gas industry downturn, as demand has slumped during the coronavirus outbreak.

The PIF is Saudi Crown Prince Mohammed bin Salman's vehicle for boosting Saudi Arabian investments at home and abroad, as he seeks to diversify the kingdom's oil-heavy economy.

The fund manages over $300bn (roughly R5.4-trillion) in assets and has stakes in Uber and electric car company Lucid Motors. It has also allocated $45bn (roughly R811.33bn) to SoftBank's $100bn (roughly R1.8-trillion) Vision Fund. On Monday it disclosed an 8.2% stake in cruise operator Carnival Corp.


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