Maha El Dahan and Saeed Azhar

DUBAI (Reuters) – Saudi Arabia’s State Oil Company Aramco was under intense West pressure to increase output and reduce prices. On Sunday, it pledged to raise investments by approximately 50% as the company reported a doubling of its 2021 profit.

Saudi Aramco Oil prices rose more than 50% last year for the SE, due to higher COVID-19 vaccinations and loosening regulations. The result was that demand exceeded supply.

After Russia invaded Ukraine in 2014, prices rose above $100 per barrel. They reached 14-year highs last month. Western nations urged Saudi Arabia to increase its production.

Aramco stated that it plans to increase its capital expenditures (capex), to 40-50 billion in this year. Further growth is expected to occur until the end of the decade. The capex was 31.9 billion in 2018, up 18% from 2020. This indicates a roughly 50% increase for the year to the middle of the guidance range.

Last year’s net profit was $110 billion, an increase of $49 billion from the previous year. According to Refinitiv’s Eikon, analysts had predicted a net profit in excess of $106 billion.

Aramco shares rose by more than 4 percent in the early trade, reaching a peak of 43.85riyals. This value placed Aramco at 8.76 trillionriyals ($2.34 billion).

Before the record-breaking $29.4billion initial public offering, Crown Prince Mohammed bin Salman de facto sought a $2 trillion value for his company.

He announced that he plans to buy more shares of Aramco.

Aramco’s value rose on Sunday to surpass that of Microsoft (NASDAQ :), but still trailed Apple (NASDAQ 🙂 by $2.68 billion.

Saudi Arabia’s Crown Prince Mohammed is leading a massive investment drive in diversifying the Kingdom’s economy. He had transfered 4% of Aramco shares over to the sovereign wealth fund.

BOOSTING CAPEX

Aramco announced that it intends to increase its “maximum sustainable capacity” to 13,000,000 barrels per day by 2027. It also wants to improve gas production by at least 50% before 2030.

Last year, the average daily hydrocarbon production of the company was 12.3 Million barrels of equivalent oil.

It stated that Aramco plans to build a substantial hydrogen export capacity and be a leader in carbon capture-and-storage technology.

Amin Nasser CEO stated that “Economic conditions have significantly improved, but the outlook remains uncertain because of various macro-economical and geopolitical elements.”

Our investment plan is designed to meet the rising demand for affordable, reliable and more sustainable energy.

Aramco stated that it had $107.5 billion of free cash flow in 2017 compared to $49.1 million in 2020. Aramco declared a 75 billion dividend for 2021 in accordance with an earlier promise.

($1 = 3.7515 riyals)

(Refile to amend the ad-dropped word paragraph 7