Shares of Sudia’s state-owned oil company Aramco (2222.SE) Cousins for the first time dropped below its initial public offering IPO price on Sunday following the termination of the OPEC oil supply deal with Russia fell apart on Friday.
Aramco shares were trading at 31. 10 riyals ($8.29) at 0724 GMT, down 5.8%, and below the IPO price of 32 riyals.
The Saudi market, TASI plunged 7% in early trade.
In December, the new record for the Aramco’s Record IPO was priced at $ 1.7 trillion, Making it the most valuable company in the world, it left 38 .70 riyals Intraday high on the second day of the business day. But since then the stock price has dropped on concerns of prices.
Aramco trades below IPO price for the first time since the OPEC deal.
Aramco stocks have dropped more than 11% since the beginning of this year because of the worries the Coronavirus has spread which will reduce oil demand from China and damage the world economy.
”Aramco is under pressure due to a lack of a contract,” said Marie Salam, head of institutions at Daman Securities.” We have already seen this impact on local markets and we do not expect it to be any different in Saudi.”
Other Gulf markets were also in the red. The Abu Dhabi stock index. ADI was down 5% and the Dubai index. ADI was down 5% and the Dubai index DFMGI had slumped 7. 7% in late morning trade.
The three-year agreement between Amarco and Russia ended Friday when Moscow refused to support the oil-deep cuts to deal with the Corona Virus outbreak and OPEC resounded by removing all restrictions on its production
The news pushed Brent futures LCOc1 to their biggest daily percentage fall on Friday since December 2008, down 9.4%, or $4.72, to settle at $45.27 a barrel. It was Brent’s lowest closing price since June 2017.
Saudi Arabia is the de facto leader of the Organization of the Petroleum Exporting Countries and the world’s biggest oil exporter.