Analysis: BP stake may help oil sovereign funds diversify

A stake in BP may seem like a curious purchase for sovereign wealth funds looking to diversify oil wealth, but it holds a definite allure: gas and renewable energy expertise and exposure to emerging economies.

Sources have said BP has approached a number of sovereign wealth funds (SWFs), including the world's largest, Abu Dhabi Investment Authority, to secure cash to fend off takeover bids while it deals with its massive U.S. oil spill.

Sovereign funds invest an estimated $3 trillion of windfall revenues from oil and exports for future generations and.

On the surface, investing in a major oil firm is unlikely to help these funds diversify their oil-generated capital. However, it could actually give them the expertise and technology needed to diversify their oil-dependent economy.

Read Full Article from Reuters

- Posted: 2010-07-08 09:52:57

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