DUBAI (Reuters) -Abu Dhabi sold $2 billion in seven-year bonds on Tuesday in its first foray into the international debt markets this year, raising cash for state coffers despite a recent rebound in oil prices. The oil-rich emirate sold the bonds at 45 basis points (bps) over U.S. Treasuries. That was tightened from initial guidance of 70-75 bps over Treasuries after the debt sale received over $6.9 billion in orders. The United Arab Emirates, where Abu Dhabi is the capital, was hit hard by the COVID-19 pandemic and last year’s crash in oil prices, but a rebound in global crude demand as economies re-open has reduced the urgency to borrow for budget purposes. “Seven years is the sweet spot in the market right now. A lot of issuers are choosing seven or 12 years because of the macros of rates,” said Zeina Rizk, executive fixed income director at Arqaam Capital, adding some of the funds might end up boosting foreign currency reserves. Citi, First Abu Dhabi Bank, HSBC, JPMorgan and Standard Chartered are joint lead managers and joint bookrunners for the deal, according to a document from one of the banks, seen by Reuters. “This is more of an updating-the-curve kind of issuance. They didn’t have a seven-year paper and hence the curve was being interpolated,” another fund manager said. Brent crude, trading at over $68 on Tuesday, has more than tripled since oil’s crash last year, when Brent fell below $20 a barrel. Abu Dhabi is expected to post a budget deficit of around 43 billion dirhams ($11.7 billion) in 2021 against 37.2 billion dirhams last year, the preliminary prospectus for the new bond offering, reviewed by Reuters, showed. The budget, however, is based on an oil price assumption of about $46 per barrel versus roughly $50 per barrel last year. “This deficit is expected to be funded principally by borrowings,” the prospectus said. Abu Dhabi has become a relatively frequent issuer of U.S. dollar-denominated debt in recent years, and tapped the market three times last year for a total of $15 billion. At the end of 2020, it had $40 billion in outstanding bonds and $3.9 billion in outstanding loans. Outstanding bonds and loans totalled $29.4 billion at the end of 2019, the prospectus showed. ($1 = 3.6726 UAE dirham) Reporting by Yousef Saba. Editing by Mark Potter and Chris Reese Our Standards: The Thomson Reuters Trust Principles.