The Saudi cabinet has approved plans to try and move the country away from its reliance on oil profits by diversifying the economy. At present, almost 80% of Saudi Arabia’s revenue comes from oil but it has been hit by falling prices in recent times.
The plan to achieve this is called Vision 2030, which includes proposales to sell less than 5% of the state-owned Aramco oil company, which is valued at $2.5 trillion. Deputy Crown Prince Mohammed bin Salman said the sale of the shares would create funds to go to a new $2 trillion sovereign wealth fund. Further details are expected to be released later on today.
Oil prices are lower so far today after WTI gapped down by approximately 30 ticks on the open. Two attempts to close the gap have failed and the market will look to US traders about to enter the fore to see if this brings additional buying power.