March 5, 2019 / 6:57 AM / 2 months ago

UPDATE 1-Qatar targets around $10 billion with jumbo bond issue - sources

(Adds context, detail)

By Davide Barbuscia

DUBAI, March 5 (Reuters) - Qatar is expected to announce this week a jumbo international bond issue which could be in the region of $10 billion, sources familiar with the matter said on Tuesday.

A debt sale of that size would be the largest placement by an emerging-market sovereign this year and would outsize Saudi Arabia’s $7.5 billion debt issuance in January.

Qatar’s deal should be announced later on Tuesday or on Wednesday at the latest, said the sources.

The ministry of finance declined to comment.

Qatar does not need to raise financing as it forecast a 4.3 billion riyals ($1.18 billion) budget surplus in 2019, partly due to higher oil prices.

But the government is expected to tap the debt markets to take advantage of improved conditions and to provide a benchmark to government-related entities that plan to sell bonds.

Qatar’s 2019 budget assumes an average oil price of $55 a barrel. Brent crude futures were at around $65 on Tuesday.

A group of banks, including Standard Chartered, has been appointed to lead the new debt sale, said the sources.

Standard Chartered declined to comment.

Qatar raised $12 billion in April last year, marking a successful comeback to international debt markets despite a rift with its Gulf neighbours.

Doha has been locked in a diplomatic dispute with Saudi Arabia, the United Arab Emirates, Egypt and Bahrain since June 2017. They all severed diplomatic and transport ties with Qatar, accusing it of supporting terrorism, a charge Doha denies.

But the world’s largest exporter of liquefied natural gas has largely overcome the economic impact of the boycott, also due to a rise in energy prices. ($1 = 3.6400 Qatar riyals) (Reporting by Davide Barbuscia; Editing by Shri Navaratnam and Shreejay Sinha)

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