DUBAI - Saudi Arabia has launched the sale of U.S. dollar denominated bonds with maturities of seven, 12 and 35 years, a document showed, tapping international investors as part of plans to raise $32 billion worth of debt this year.

The bond sale is the first by a Gulf government this year and follows a rise in geopolitical tensions in the region after Iran and the United States, Riyadh's ally, traded military strikes earlier this month.

Riyadh has been borrowing extensively over the past few years, locally and internationally, as it seeks new financing channels in an era of lower oil prices.

The new debt sale, which is due to close later on Tuesday, will be of benchmark size, meaning each tranche is expected to be at least $500 million, a document issued by one of the banks leading the deal showed.

The Kingdom is offering initial price guidance of around 110 basis points (bps) over U.S. Treasuries for the seven-year paper, the document showed, 135 bps over the benchmark for the 12-year tranche, and 180 bps over for the 35-year - its longest ever international debt tranche.

Saudi Arabia's dollar bonds, among the most liquid in the region, have been relatively resilient after an attack on the facilities of state-owned oil giant Aramco last year and U.S. drone strikes that killed Iranian military commander Qassem Soleimani this month.

The spreads on offer looked "cheap" particularly for the longer dated tranches, said Zeina Rizk, fixed income executive director at Dubai's Arqaam Capital.

"There is definitely a risk premium linked to geopolitical risk, but markets didn’t sell off as much as you would have expected them to after the Aramco attack or after Soleimani’s strike. Initial price guidance is cheap but it will obviously tighten," she said.

Raffaele Bertoni, head of debt capital markets at Gulf Investment Corporation, expects the deal to be oversubscribed and said spreads could tighten by 15 to 20 basis points as the deal is marketed on Tuesday.

Citigroup, Morgan Stanley and Standard Chartered are joint global coordinators and lead managers, and BNP Paribas, HSBC, JPMorgan and NCB Capital have been hired as passive lead managers.

Of Saudi Arabia's total planned debt issuance this year, almost $12 billion will be used to refinance existing local debt and will also be raised locally, a finance ministry official told Reuters last month. 

International debt is expected to account for 45% of the remaining $20 billion-worth of new funds that Riyadh plans to raise.

(Reporting by Davide Barbuscia; additional reporting by Yousef Saba; Editing by Kim Coghill, Kirsten Donovan) ((Davide.Barbuscia@thomsonreuters.com; +971522604297; Reuters Messaging: davide.barbuscia.reuters.com@reuters.net))