21-03-22, 12:43
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Re: UK Gets Help From Saudi as OIL Price Soars-Saudi Aramco Boosts Production
UK Boris Johnson Asks Saudi For Help -Gets Good Response-Saudi Aramco Ramps up to Boost Production
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BBC 21 MAR 2022
The state-owned oil giant Saudi Aramco plans to sharply increase the amount it invests in energy production,
The firm aims to boost output significantly over the next five years.
Energy prices have soared in recent months as demand has outstripped supplies of oil and gas.
The war in Ukraine and a reluctance to rely on Russia for energy has added to the pressure to find additional sources of energy.
Saudi Aramco's move is likely to be welcomed by political leaders worried about the impact of high energy prices, although the boost to investment is aimed at increasing output over the course of the next five to eight years.
Last week prime minister Boris Johnson visited Saudi Arabia to try to persuade the country to release more oil into world markets in the short term.
Saudi Arabia is the largest producer in the oil cartel Opec (Organization of the Petroleum Exporting Countries) and by raising production it could help to reduce energy prices which are currently at 14-year highs.
However, the country has been condemned for a range of human rights abuses: its involvement in the conflict in neighbouring Yemen, the murder in 2018 of journalist Jamal Khashoggi, for jailing dissidents and for widespread use of capital punishment.
The chancellor, Rishi Sunak, said the prime minister was "absolutely right" to engage with Saudi Arabia over increasing energy supplies.
"It would be wrong if we weren't exploring all the avenues we could to bring cheaper energy and more secure energy to people in this country," Rishi Sunak told the BBC.
The prime minister had "constructive dialogue" about human rights abuses during the visit, he said.
Energy markets have been volatile during the pandemic, as sudden changes in economic activity have influenced both supply and demand.
But a reopening in many countries led to a sharp rise in energy prices in 2021. That boosted revenues at all the large energy generating companies.
Saudi Aramco said it planned to increase its capital expenditure to $45-$50bn this year with further increases until the middle of the decade. Last year capital expenditure was $31.9bn.
It would raise its crude oil "maximum sustainable capacity" to 13 million barrels a day by 2027, the company said. It also aims to increase gas production by more than 50% by 2030. Saudi Arabia produced just over 10 million barrels of oil per day in February.
The oil company more-than doubled its net profit to $110bn in 2021, up from $49bn in 2020.
The price of a barrel of Brent crude oil increased by around 50% in 2021 and, with energy prices remaining high, analysts expect profit to increase further in 2022.
Saudi Aramco said it planned to develop a significant hydrogen export capability and become a global leader in carbon capture and storage technology.
RELATED;
Energy giant ExxonMobil and aviation group Boeing joined the growing list of companies to take action over Russia's invasion of Ukraine.
ExxonMobil said it will exit a multi-billion dollar joint venture with Russian state-owned company Rosneft.
It is the latest oil producer to cut business ties with the country, after similar moves by BP, Shell and Equinor.
ExxonMobil currently operates and holds a stake in the Sakhalin Island oil and gas fields, alongside Rosneft and companies from Japan and India.
It said it would now exit its Russian oil and gas operations, which have been valued at more than $4bn (£3bn), and halt new investments in the country.
Last year, ExxonMobil employed more than 1,000 people across the country, with offices in Moscow, St. Petersburg, Yekaterinburg and Yuzhno-Sakhalinst, according to its website.
Russia is one of the world's biggest energy producers.
The announcement came as Brent crude - the international benchmark for oil prices - hit $110 a barrel, marking the highest level seen in more than seven years.
Rival energy giant BP said it would offload its 19.75% stake in Rosneft after Russia's "act of aggression in Ukraine".
On the same day, Shell announced that it would end all of its joint ventures with the Russian energy company Gazprom. This includes quitting the flagship Sakhalin II facility, which is partly owned and operated by Gazprom.
Norwegian oil producer Equinor also said it would start the process of divesting from its joint ventures in Russia.,,
Also, aviation giant Boeing said it had suspended "major operations" in Moscow and temporarily closed its office in Kyiv.
"We are also suspending parts, maintenance and technical support services for Russian airlines," a Boeing spokesperson told the BBC.
Canada imported more than $250 million worth of refined petroleum products from Russia in 2021.
US Seeks Help From Saudi Arabia to Ease Oil Prices -Gets Cold Response
Oil Prices Plummet as Russia Seeks to Revive Nuclear Deal With Iran
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