Abu Dhabi National Oil Co. delays bond sale

ABU DHABI - Abu Dhabi National Oil Company (ADNOC), the United Arab Emirates' flagship energy producer, postponed its planned debut issuance of yuan-denominated bonds (known as dim sum bonds) as global credit markets face heightened uncertainty driven by the ongoing Middle East crisis, according to a Bloomberg report on Monday.

The decision comes just weeks after ADNOC was actively exploring a multi-tranche offering worth up to $2 billion (approximately 14 billion yuan).

According to people familiar with the matter, ADNOC had been monitoring conditions to secure the most favourable borrowing costs but has now paused the process indefinitely. 

Further discussions are pending, with the sale potentially resuming when market stability returns. This marks a notable setback for ADNOC's push to diversify funding sources and deepen financial ties with China, following earlier reports in February that the company was evaluating a three-tranche structure with maturities of 5, 10, and 30 years.

Background on the proposed issuance

ADNOC's potential dim sum bond debut would have been its first foray into offshore yuan debt markets, building on its growing international financing footprint. The company has successfully tapped global debt markets in recent years, including a $4 billion conventional bond issuance in September 2024 and a $1.5 billion 10-year sukuk (Islamic bond) in April 2025, which attracted strong demand.

The yuan bond plan aligned with broader UAE-China economic cooperation, including increased trade, investment, and energy partnerships. It would have contributed to the already record-breaking 77 billion yuan ($11.2 billion) in corporate dim sum bonds priced in 2026 so far, signaling strong interest in Chinese currency instruments despite global headwinds.

The primary driver cited for the postponement is volatility in credit markets triggered by the escalating conflict in the region. The joint US-Israeli strikes on Iranian targets and Iran's subsequent missile and drone retaliations — including attacks on US-allied states across the Gulf — have rattled investor sentiment. 

ADNOC, like other Gulf issuers, typically times debt sales to capitalize on favorable windows. With risk premiums elevated and liquidity conditions tightening, proceeding now could have resulted in higher borrowing costs than anticipated.

Analysts note that ADNOC could still move forward later in 2026 if tensions ease or if alternative funding avenues (such as additional dollar or dirham bonds) prove more viable.