Abu Dhabi borrows $7 billion as low oil prices bite
ABU DHABI, United Arab Emirates – The emirate of Abu Dhabi said on Sunday, April 19, it had sold $7 billion of bonds in the 3rd major sale this month by Gulf sovereigns seeking to counter slumping oil prices.
Organization of the Petroleum Exporting Countries (OPEC) kingpin Saudi Arabia last week raised $7 billion in a bond sale, while gas-rich Qatar sold bonds worth $10 billion two weeks ago.
Abu Dhabi, which has the biggest sovereign wealth fund in the Gulf Cooperation Council (GCC), said that its offering was oversubscribed by more than 6 times.
The transaction contained 3 tranches – a $2-billion 5-year tranche, a $2-billion 10-year segment, and a 3rd tranche of $3 billion maturing after 30 years – the Abu Dhabi department of finance said in a statement.
The richest of 7 sheikhdoms that make up the United Arab Emirates, Abu Dhabi sits on the bulk of the federation's oil wealth.
Saudi Arabia's finance ministry said its international bond issuance attracted bids worth $54 billion, more than 7 times the value of its offering.
Qatar's finance ministry said its own sale was oversubscribed by more than 4 times.
The Kuwaiti government has sent legislation to parliament seeking to borrow $65 billion over the next 10 years.
The 6 GCC member states, which also include Bahrain and Oman, depend heavily on oil income for between 65% and 90% of public revenues.
An agreement by OPEC and its allies, including Russia, to cut output by a record 9.7 million barrels per day last week failed to revive prices.
According to the International Monetary Fund, the combined economies of GCC states are forecast to shrink by 2.7% this year. – Rappler.com