Aramco shares hit lowest level since IPO amid investor jitters over war

Dubai — Saudi Aramco shares fell 1.7% on Sunday to the lowest closing price since their December 11 debut on the local stock exchange after the US killing of a top Iranian commander in Baghdad stoked investors fears of war in the region.

Shares fell to Riyals 34.55, still above the IPO price of Riyals 32, on the local stock exchange Tadawul. In Friday trading, Exxon and Chevron declined less than 1% while BP surged 2.75%, Occidental rallied 2.4% and Royal Dutch Shell climbed 1.5%. Brent settled 3.55% higher at £68.60/b while WTI rose3.06% to $63.05/b on Friday.

Prior to today's fall, Aramco shares were up 10% since their December 11 debut on Tadawul.

Iran pledged on Friday to avenge US air strikes that killed top Iranian military commander General Qassim Soleimani in air strikes in Baghdad, severely raising the risk of more attacks by Iran against Middle Eastern and US interests in the region, which could impact oil production and supplies.

Saudi Arabia, which temporarily lost 5% of its output in September attacks blamed on Iran, urged de-escalation following the assassination of Soleimani.

In a statement released on Friday, Saudi Arabia urged the international community "to undertake all necessary measures to guarantee the security and stability of this region that is vital for the whole world."

Its views were echoed by the UAE, OPEC's third largest oil producer. The UAE's Minister of State for Foreign Affairs Anwar Gargash tweeted on Friday that "wisdom and balance should prevail and political solutions should prevail over confrontation and escalation."

Saudi Arabia, the world's biggest oil exporter, pumps most of its crude from Aramco fields.

The kingdom's output was 9.9 million b/d in November, according to the latest S&P Global Platts OPEC survey.

Comments by Russian Energy Minister Alexander Novak last month raised questions about the future of the OPEC+ agreement to cut 1.7 million b/d. Novak said that OPEC+ might consider ending their oil output curtailment deal in 2020 to preserve market share and implement projects. OPEC+ members will discuss the latest cuts during a March meeting in Vienna. Under the new cuts, Saudi Arabia promised an additional voluntary cut of 400,000 b/d.

Saudi Arabia's new quota is 10.145 million b/d, but the kingdom plans to produce at a maximum of 9.744 million b/d with its voluntary cut.

(Updates with closing share price)

--Dania Saadi, dania.el.saadi@spglobal.com

--Edited by Claudia Carpenter, claudia.carpenter@spglobal.com