Completely dwarfing rivals

If you ever wondered how the House of Saud keeps itself in personalised 747s complete with essential features such as concert halls and automatically rotating prayer rooms to ensure you are always pointing at Mecca, look no further than Saudi Aramco. Ever since the Saudi government bought out its American partners in 1980, the company has been pouring out cash, but the precise quantity was a little obscure until its 469-page bond prospectus dropped with a mighty thud last week.

Plans to float the company were put on hold last year, but it is looking to raise about $10bn to help fund the $69.1bn acquisition of Sabic, hence the lifting of the veil on its numbers. Last year Saudi Aramco produced 10.3million barrels of oil a day, generating revenues of $355.9bn and net income of a cheeky $111.1bn. This completely dwarfs the performance of rivals that in most circumstances would be viewed as pretty decent-sized players, such as Royal Dutch Shell on $23bn and Exxonmobil on $21bn.

Its profits are not far shy of double those of Apple, the world’s secondmost profitable company, which came in at $59.5bn in 2018. Even if global demand for hydrocarbons slackens off due to fears of climate change, the nature of Saudi’s reserves and its production techniques mean that carbon emissions per barrel are a third of Venezuela’s. Coupled with the world’s lowest production costs at $2.80 a barrel in 2018, the company is better placed than most to cope in a falling-demand environment, and it should keep the Saud family in toys for years to come.

Its profits are not far shy of double those of Apple, the world’s second-most profitable company