Earlier, al-Falih told the Saudi-owned Al-Arabiya news channel that any initial public offering of Saudi Aramco would not include the kingdom’s oil reserves.
I don’t think they are in trouble. I think they are positioning for the very long term.
The Saudis are extremely cash strapped. They have enormous expenditures financing the jihadists in Syria and Iraq ( the Russian intervention vastly increased their costs), waging war in Yemen and subsidizing the cost of essentials in Egypt to keep that huge Sunni nation “stable”. They also have large commitments throughout the Sunni world. The Saudis are also liquidating large portions of their investment portfolios. This selling is contributing to the decline of stock prices. The Chinese are also selling to raise cash to support the yuan. The corrupt and decadent House of Saud is under severe pressure and may not be long for this world.
Saudi Arabia is trying to create a post oil economy. Divesting from the oil industry is a step in that direction.
In the meanwhile, they are trimming costs, selectively borrowing, raising revenues and taxes, and cracking down on internal dissent and on their restive Shiite minority. The Saudis are also trying to develop a capacity for fracking and are using it to develop natural gas for electric power generation so that the oil saved can be exported.
For a thuggish regime held in disdain by much of its populace and most of the world, these new policies involve risks and uncertainties. More than that, they indicate that the days when the Saudis could open up their checkbook and do as they wished are passing. The Saudis will have to tread carefully. To the category of presumptive enemies who will not be bought, the Saudi regime must now deal with an even larger category of people they can no longer afford to buy.