Is the market treating Aramco like other IOCs? Price movement from the geopolitical crisis with Iran says no.
between the United States and Iran gives a very useful test for how investors see the Saudi oil firm, and it makes a compelling case that Aramco is an entirely new type of oil business in the eyes of the market.
Similarly, as the tensions and then actual conflict between the U.S. and Iran escalated from a killed U.S. contractor to targeted bombings to an assault on an embassy to the elimination of a top Iranian general, the values of shares of bellwether IOC’s like Exxon and BP rose. At the start of trading in New York on New Years Eve, BP was at $37.41. By the start of trading on Monday, January 6, it was $39.68, an increase of more than 6%. Exxon increased from $69.02 to $70.3 in that period.
While the IOCs rose on the news of geopolitical tension and higher oil prices, Aramco’s price fell. This is likely due, in large part, to the fear that Aramco facilities could be targets for Iranian reprisal, just as Aramco facilities were targeted in September and have been targeted by Houthi forces in Yemen for the past couple of years. But these past attacks on Aramco have never really interfered with the company’s ability to make a huge profit.
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