Saudi Arabia's decision to cut tax paid by national oil giant Saudi Aramco has increased its value by US$1 trillion, an analyst estimated on Tuesday ahead of Aramco's initial public offer of shares, expected to be the world's largest. "Assuming long-term oil prices averaging US$75 per barrel, the valuation of the company increases from US$0.4 trillion to US$1.4 trillion," he said in a report. Deputy Crown Prince Mohammed bin Salman, who leads economic reforms, has said the IPO will value Aramco at a minimum of US$2 trillion. Under the new tax rate, much of the company's payments to the government are expected to be in the form of dividends, not tax. "The total value of Saudi Aramco's revenue after costs is around US$3.4 trillion.

Source: Egypt Independent March 28, 2017 13:52 UTC