Saudi Aramco is considering selling a stake in its sulfur business that could bring in up to $7 billion, adding a fresh source of cash to a company already leaning on asset sales. The move would extend a pattern of monetizations that has become one of Aramco’s main ways of raising funds while oil prices stay weak.
The timing matters because sulfur markets have tightened after the Middle East war disrupted a solid chunk of global supply, pushing the commodity into a hot market just as Aramco is looking to monetize it. Sulfur is used across multiple industries, which gives the business value beyond oil, and the company has already benefited from a war-triggered price surge earlier this year even as prices have since eased again after the United States and Iran sign their preliminary peace deal.
One source put the value of Aramco’s infrastructure assets at as much as $50 billion, a figure that helps explain why the company keeps returning to its holdings when it needs cash. Aramco has been selling stakes in infrastructure holdings for a while, and earlier this year reports said it was eyeing up to $10 billion from asset sales in its real estate division, including Dhahran Camp in the Eastern Province of Saudi Arabia.
The most recent template came last year, when Aramco struck an $11-billion deal with a group of investors led by BlackRock. That transaction covered the lease of midstream facilities at the Jafurah gas project, which has a price tag of $100 billion, and the investor group will lease the facilities back to Aramco for 20 years.
The push is not happening in a vacuum. Aramco is the biggest contributor to Saudi Arabia’s budget revenues, and Saudi Arabia’s budget breakeven price of oil has climbed to over $90 per barrel, leaving the Kingdom under pressure to keep finding cash even after the rally tied to the Middle East war helped revenues earlier in the year. That is why a sulfur sale, if it goes ahead, would matter well beyond one business line: it would deepen Aramco’s shift from drilling earnings to asset monetization, and it would do so in a market that is still strong enough to tempt buyers but not certain enough to guarantee a deal.
What remains unresolved is whether Aramco will sell at all, and if it does, how large a stake it is willing to part with. For now, the sulfur business has moved into the same category as the company’s other prized holdings: assets that can be turned into cash when the budget math gets tight.
