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LONDON—Saudi Arabia is considering selling shares in its state-owned oil company, a move that comes amid a broad privatization effort afoot in the kingdom, but also at a vulnerable time for Riyadh because of tumbling energy prices.

Any move to list shares in Saudi Arabian Oil Co., better known as Saudi Aramco, would almost assuredly be limited in scale, and could exclude its strategic production assets altogether. But an initial public offering of only a small slice of what is widely considered one of the world's most valuable companies could raise billions of dollars. That would bolster government coffers at a time when global oil prices continue to slide, recently hitting lows not seen in over a decade.

Riyadh has a sizable cushion of foreign reserves to protect it from lost oil revenue. But it has also shown some signs of financial strain, ratcheting down government spending and reducing generous energy subsidies to save cash.

Talk of a partial listing of Aramco has surfaced from time to time for years. In an interview with the Economist magazine published Thursday, Mohammad bin Salman Al Saud, Saudi Arabia's powerful deputy crown prince, laid out the kingdom's most specific comments yet on the possibility, while suggesting a decision to move ahead could be imminent.

"This is something that is being reviewed, and we believe a decision will be made over the next few months," he told the British publication. "Personally, I'm enthusiastic about this step."

A person familiar with the matter said that the idea of somehow floating a minority stake in the company is under very early consideration. The Saudi government would retain full control, and any share sale might be designed to exclude its core crude-producing business, said the person.

Aramco has the largest proven reserves of any oil company in the world, pumps around 10 million barrels a day and has the capacity to churn out 12 million barrels a day.

Aramco said in 2015 that it had proven reserves of over 261 billion barrels of crude oil and condensate. By contrast, Exxon Mobil Corp., the largest non-state-controlled oil company, had proven reserves of 25.3 billion barrels of oil equivalent in 2014.

Aramco is also the workhorse that has allowed Saudi Arabia to operate for decades effectively as the central bank of the world's oil market. Saudi Arabia is the de facto leader of the Organization of the Petroleum Exporting Countries, the cartel of some of the largest producers.

The group for years has intervened in global oil markets, ratcheting down production to bolster prices and protect revenue for its members. But in late 2014, Saudi Arabia pushed the group to reverse course, keep its spigots wide open and compete for global market share with booming U.S. producers, exacerbating the falling oil price.

Aramco also controls massive refining assets both inside Saudi Arabia and abroad. While overseen directly by the government, Aramco has long been run somewhat at arm's length from the country's oil ministry. Executives pride themselves on a level of operational independence from the government.

The listing proposal comes as Saudi Arabia for the first time allows foreign investors to buy shares in its stock market, known as the Tadawul. Saudi officials hope the market opening will attract foreign investment at a time when the government has to cut back on capital spending.

Government revenue has fallen with oil prices, which have dropped by two thirds in the past 18 months. The government ran a record deficit last year.

Prince Mohammed bin Salman, a son of King Salman bin Abdulaziz who has been given oversight of the kingdom's economic-development plans as well as its oil industry, told the Economist a share listing could help on both fronts.

"I believe it is in the interest of the Saudi market, and it is in the interest of Aramco, and it is for the interest of more transparency, and to counter corruption, if any, that may be circling around Aramco," he was quoted as saying. The prince didn't provide further details of how any initial public offering would be made.

Aramco has previously listed a subsidiary, Rabigh Refining and Petrochemical Co., in 2008 in the local stock exchange. The refinery, which processes 400,000 barrels a day, has a market capitalization of $2.33 billion.

Given Aramco's strategic importance, many of the operational and geological specifics related to Saudi production and reserves are treated essentially as state secrets. Listing the company might subject Aramco to disclosure requirements and call for a new level of transparency that could complicate the government's preference for operating out of the public eye. That is one reason officials might choose not to include the heart of Aramco in any share sale.

"Officials realize that listing shares in the core business would mean more transparency and more disclosures on finances, production figures, etc.," said the person familiar with the discussions.

The deputy crown prince's comments come after Saudi officials said last year that both Aramco and the kingdom's petroleum ministry could be restructured. Part of the plan is to expand the ministry into a full-fledged energy ministry that will also oversee water and electricity, as well as nuclear and renewable energy sources.

The plan is being discussed by the Supreme Economic Council, formed last year and headed by the deputy crown prince. It replaces the Supreme Petroleum Council, which used to help set the kingdom's oil policy.

A new supreme council for Aramco was also created last year that is above Aramco's board of directors. Prince Mohammad bin Salman is chairman of the new supreme council, while former Aramco Chief Executive Khalid al-Falih heads Aramco's board of directors.

Write to Kevin Baxter at Kevin.Baxter@wsj.com

(END) Dow Jones Newswires

January 07, 2016 21:25 ET (02:25 GMT)

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