The Total Perspective Vortex, an invention of sci-fi writer Douglas Adams, tortured victims with their own insignificance. Saudi Aramco fulfils that function for oil supermajors. It has just announced quarterly net income of $48.4bn, more than double Exxon’s figure. The Saudi Arabian group is worth $2.4tn, six times the market capitalisation of the US company.
Hold those “oohs” and “aahs”. The comparison has implications beyond rubbernecking amazement. Saudi Aramco is the leading leviathan in a pod of national oil companies (NOCs), including PetroChina, Rosneft and Petrobras. High energy prices have strengthened the financial muscle they bestow on their controlling governments. The susceptibility of the latter to environmental lobbying is low.
Saudi Aramco has been talking up renewable energy plans, even so. These include ramping up blue hydrogen production. But the surging capital expenditure target of the state-controlled business, up by half from 2021 to between $40bn and $50bn, underscores its likely position as one of the last oil producers in the energy transition.