Fitch Ratings has revised its outlook for both Saudi Aramco and SABIC from stable to positive, as it affirmed its rating of the two companies at (A).
According to Arabiya Net, the agency raised its outlook from stable to positive for 8 Saudi banks, namely Riyad Bank, SABB, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Al Jazira Bank and Bank Al Jazira. International Gulf.
This is in line with her elevation of Saudi Arabia's future outlook last week.
Fitch said that higher oil prices will support Aramco, and Aramco's annual capital expenditures will rise to $40 billion - $50 billion in 2022, compared to $32 billion in In 2021, on the back of its efforts to increase oil production capacity by one million barrels of oil per day to 13 million barrels per day by 2027 as mandated by the government, in addition to other strategic initiatives, including gas production, and green projects.
We believe the company will remain resilient and will continue to generate strong pre-dividend earnings even under our moderate oil price assumptions, Fitch said.
Saudi Aramco has an ambitious goal of paying at least $75 billion in annual dividends. We estimate that under our assumptions for oil prices, capital expenditures and dividend payments should be covered broadly by operating cash flows. We believe that Saudi Aramco has the flexibility to reconsider its dividend commitment in the event of lower oil prices or higher capital expenditures than we currently assume.
Fitch emphasized that Saudi Aramco's business profile is very strong, and the cost is much lower than that of integrated global companies and some national oil companies, which is an important advantage in times of oil price volatility. .
