Saudi Aramco emerges world second largest company

Saudi Aramco, the Saudi Arabian Oil Group, has emerged as the world’s second largest company.

The oil group has surpassed Microsoft to become the second largest company in the world based on market value. With a current market value of $2.11 trillion or 7.92 trillion Saudi riyals, Aramco aims to surpass Apple and become the largest company globally.

The company’s profits for 2022 exceeded the combined profits of Apple, Microsoft, and ExxonMobil, leading to an upgrade in its rating by Fitch Ratings to A+ with a stable outlook.

In March 2023, Saudi Aramco announced a net profit of $161.1 billion for 2022, marking the highest profit ever declared by an oil firm worldwide. This represents a significant increase of 46.5% from the previous year. Despite awaiting the release of its first-quarter 2023 results on May 9th, Aramco has already disclosed plans to invest up to $55 billion in capital projects to increase its crude production.

The company’s first-quarter 2023 net income estimate, based on 16 analyst forecasts, stands at $31.2 billion. Saudi Aramco has identified several focus areas, including expanding its upstream capacity to 13 million by 2027, extending its presence in key Asian markets such as China, and investing in technologies to reduce its carbon footprint and achieve net-zero targets by 2050.

Saudi Arabia aims to expand its current 12 million barrels per day (bpd) nameplate oil production capacity by 1 million bpd by 2027 through various offshore and onshore projects. The Chief Executive of Saudi Aramco, Amin Nasser, announced plans to achieve an additional 3 million bpd of oil export capacity by the end of the decade. This expansion will involve incremental oil and gas projects as well as the replacement of liquid fuels.

Nasser revealed that Aramco’s ongoing capacity enhancement program is expected to contribute 1 million bpd by 2027, while an additional 1 million bpd will come from increased gas availability in the utility sector. The expansion of gas production capacity will also generate more natural gas liquids and condensate, resulting in another 1 million bpd by 2030. However, Nasser clarified that there is currently no government mandate to exceed 13 million bpd of oil production.

As part of its gas production expansion efforts, Saudi Aramco is leading the $100 billion-plus Jafurah unconventional gas program, aiming for a 50% growth in gas production by 2030. These developments highlight Saudi Aramco’s ambitious plans to maintain its position as a global energy powerhouse while simultaneously addressing environmental concerns.