Saudi Arabia may spend $50 billion this year to expand its oil production capability.
The company has said it plans to raise its crude oil "maximum sustainable capacity" to 13 million barrels a day by 2027 and wants to increase gas production by more than 50% by 2030. Its average hydrocarbon production was 12.3 million barrels of oil equivalent per day last year.
Boakyewaa Lawrencia 
Saudi Arabia's state oil company, Aramco, pledged on Sunday to increase investments by around 50% this year as it reported a doubling in 2021 profits, despite pressure from the West to increase output amid soaring prices.
Oil prices rose 50% last year as demand recovered from the Covid-19 pandemic, then soared to 14-year highs in February after Russia invaded Ukraine, prompting Western nations to urge major producers to boost output.
Aramco announced that it would increase its capital expenditures (capex) to $40-50 billion this year, with more growth expected until the middle of the decade.
Capex was $31.9 billion last year, up 18% from 2020 — indicating an increase of about 50% for this year at the middle of the guidance range.Asked if Aramco would pump more oil to fill any gaps in the market left by the war in Ukraine, CEO Amin Nasser said it would produce according to guidelines from the Saudi energy ministry.
The company has said it plans to raise its crude oil "maximum sustainable capacity" to 13 million barrels a day by 2027 and wants to increase gas production by more than 50% by 2030. Its average hydrocarbon production was 12.3 million barrels of oil equivalent per day last year.
Aramco made $110 billion in net profit in 2021, up from $49 billion a year earlier and compared with analysts' mean estimate of $106 billion, according to Refinitiv Eikon. With a rise in both output and prices, analysts expect net profit to reach $140 billion in 2022.
Aramco's shares rose over 4% in early trade to a high of 43.85 riyals, valuing it at 8.76 trillion riyals ($2.34 trillion).
Before the company's record $29.4 billion initial public offering in 2019, de-facto Saudi leader Crown Prince Mohammed bin Salman wanted a $2 trillion valuation. He has stated that he intends to sell more Aramco stock.
Aramco's stock price soared beyond Microsoft's on Sunday, although it still trails Apple's $2.68 trillion valuations.
Crown Prince Mohammed, who is leading a massive investment drive to diversify the kingdom's economy, transferred 4% of Aramco shares to the country's sovereign wealth fund last month, according to the Saudi government.
Aramco's stock price soared beyond Microsoft's on Sunday, although it still trails Apple's $2.68 trillion valuations.
Crown Prince Mohammed, who is leading a massive investment drive to diversify the kingdom's economy, transferred 4% of Aramco shares to the country's sovereign wealth fund last month, according to the Saudi government.
Boosting CAPEX
"They are ramping up the reinvestment quite substantially and they are likely to use (the free cash flow) to de-lever the balance sheet," said Yousef Husseini, head of the materials team at EFG Hermes Research.
Aramco's free cash flow was $107.5 billion last year, compared to $49.1 billion in 2020, according to the company. It declared a $75 billion dividend for 2021, which it had previously promised.
The company also plans to create a large hydrogen export capability and become a global leader in carbon capture and storage technology, according to the corporation.
The company also plans to create a large hydrogen export capability and become a global leader in carbon capture and storage technology, according to the corporation.
During an earnings call, Nasser stated that global oil demand was healthy and that spare production capacity was shrinking.
"While economic conditions have improved significantly," he said in a second statement, "the prognosis remains unpredictable due to several macroeconomic and geopolitical variables."
