Preparation for the largest and most anticipated IPO in the history is not going as smoothly as planned. The informal meetings between Aramco and members of the American investment elite proved that ambitious plans outlined recently by Saudi Arabia may not be realized anytime soon. This is a serious setback for the nation, which has hoped to use this IPO to advance its current policy of reducing reliance on oil, implemented by Crown Prince Mohammed bin Salman.

During latest informal meetings, major U.S. investors expressed concerns about the planned IPO. The circumstances are less than ideal: shale output will continue to provide additional supply to a nearly oversupplied market, OPEC may be not persuasive enough to keep an attractive price level for much longer, investors tend to turn away from fossil fuels, and the outlook for U.S. monetary policy has put pressure on the dollar-fixed riyal. All of these factors cast a shadow on the valuation of the Aramco shares, causing the Saudi Arabia authorities to postpone the IPO to 2019. Aramco may postpone going public internationally and list first on Tadawul, the Saudi Arabia exchange. This choice would be understandable in light of the fact that index firm MSCI is soon to add Saudi Arabia in the emerging markets group, which is expected to increase capital inflow.

In 2017, global exchanges hosted the highest number of flotations since the financial crisis in 2008. Investors closely watched the Shanghai and Shenzen exchanges, which hosted a record number of IPOs.With rising oil prices and positive economic sentiment, IPOs in energy space were common and impactful, reshaping both international and domestic energy markets. Gulf Energy (SET:GULF), one of the biggest Thai power companies, went public and raised over $700mn, which will be invested in gas-fired and biomass power plants. Houston-based Keane Group (FRAC  ) was the first among many fracking-related companies to go public in 2017.

With the apparent stability of oil prices, higher demand for fracking, and turning towards renewables and away from coal in most major economies, the outlook for energy companies going public in 2018 is optimistic. Nine Energy (NINE  ) and Quintana Solutions (QES  ), an oilfield service company, decided on floatation in January, marking a continuation of the positive trend for U.S. companies. In times of ESG investing, more renewable energy companies may decide to go public and raise capital to fund their long-term projects. 2017 was a year of green stocks with falling solar costs and heavy investment in renewables in all major economies. The trend to go green is visible and will not be reversed easily, especially as huge renewable energy projects are underway across the world.

While Saudi Aramco's floatation would be an exciting opportunity, it may have been poorly timed. It also faces stiff competition from green stocks; investors may expect an increased number of IPOs in the alternative energy market in 2018.