Saudi Arabia's state-owned oil behemoth is increasingly looking to just float locally, as plans to list on an international exchange hang in the balance, Reuters reported, citing sources close to the matter.

Saudi Aramco had planned to begin trading on the country's domestic stock market — the Tadawul — and one or more foreign exchanges in the second half of 2018. London, New York and Hong Kong are among the foreign bourses currently competing for the share sale.



However, a Reuters report on Tuesday morning suggested Riyadh is now banking on being awarded emerging market status in the influential MSCI benchmark equity index in June, according to its sources. Significantly more money tracks emerging markets which should allow Aramco to attract Western funds, in addition to other flagship investors from China, Japan and South Korea.



"I would guess it is about evens that there will be no international IPO," said a high-level source familiar with the preparations, according to Reuters. The source added that the preparations were proving to be a disappointment. CNBC has not been able to independently verify these sources.



Saudi Aramco was not immediately available for comment when contacted by CNBC.