Aramco, Saudi Arabia's national oil giant, was the most profitable company on the planet in 2018, posting a net profit of $111.1 billion but China's Sinopec continued to lead the world’s biggest oil and gas companies, generating $426bn in revenues. There are many companies making billions of dollars from petroleum. Investopress profiles the five biggest of them.
1. China Petroleum & Chemical Corporation (Sinopec) – $426bn
Sinopec's operating revenue was up by 22.09% to reach $426bn in 2018. The company’s refinery and distribution segment accounted for approximately 60% of the total revenue. The state-owned Chinese oil company in Beijing was formed in 2000 out of the China Petrochemical Corporation.
Sinopec's business includes oil and gas exploration, refining, and marketing; production and sales of petrochemicals, chemical fibers, chemical fertilizers, and other chemical products; storage and pipeline transportation of crude oil and natural gas; import, export and import/export agency business of crude oil, natural gas, refined oil products, petrochemicals, and other chemicals.
Sinopec is listed on the Shanghai Stock Exchange, the Hong Kong Stock Exchange and the New York Stock Exchange.
2. Royal Dutch Shell – $388.37bn
Shell registered a 27.26% year-over-year growth to achieve $388.37bn of operating revenue in 2018. The company’s downstream business accounted for 86.17% of the total revenue.
Shell was formed in 1907 through the amalgamation of two rival companies: the Royal Dutch Petroleum Company of the Netherlands and the “Shell” Transport and Trading Company Limited of the United Kingdom. The company is headquartered in The Hague, the Netherlands and incorporated in the United Kingdom.
It is an international energy company with expertise in the exploration, production, refining and marketing of oil and natural gas, and the manufacturing and marketing of chemicals.
Shell has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It has secondary listings on Euronext Amsterdam and the New York Stock Exchange.
3. Saudi Aramco $359.9bn Saudi Arabia's national oil company posted a net profit of $111.1 billion in 2018, dethroning Apple as the world's most profitable firm. International ratings agencies Fitch and Moody's Investors Service got rare access to Aramco's accounts which show the oil giant generated $359.9 billion in revenues.
Saudi Aramco, officially the Saudi Arabian Oil Company was founded in 1933 as California-Arabian Standard Oil Company. The company is based in Dhahran, Saudi Arabia and focuses on hydrocarbons exploration, production, refining, distribution, shipping, and marketing crude oil and natural gas liquids.
Earlier this month, Aramco tapped international debt markets for the first time ever, receiving more than $100 billion in orders for its maiden international bond which breaks all records for a bond issue by an emerging market entity. The company which filed filed for its international bond debut on April 8 a $10 billion issuance said it will use the proceeds from the bond sale for general purposes.
Aramco last year put its plans for an initial public offering on hold until 2021. The IPO -that could value the oil company at $2 trillion- aimed at raising money for a government looking to cut its budget deficit and diversify its economy beyond oil.
4. China National Petroleum Corp (CNPC) – $346bn
CNPC registered a 25% year-on-year growth to achieve $346bn operating revenue in 2018 out of which PetroChina contributed $298bn.
CNPC is the government-owned parent company of publicly listed PetroChina Co. Ltd. and is the largest integrated energy company in China. The company engages in the hydrocarbon exploration and production operations in onshore and offshore areas in China, Africa, Central Asia-Russia, South America, the Middle East, and the Asia-Pacific.
It is listed on the Hong Kong Stock Exchange and the New York Stock Exchange. In 2018, PetroChina signed significant LNG deals with Qatar and Canada.
5. BP Plc – $298.75bn
BP reported a 24.37% year-on-year revenue growth in 2018 earning $298.75bn. BP's origins date back to the founding of the Anglo-Persian Oil Company in 1908, established as a subsidiary of Burmah Oil Company to exploit oil discoveries in Iran. In 1935, it became the Anglo-Iranian Oil Company and in 1954 British Petroleum.
It is a vertically integrated company operating in Europe, North and South America, Australia and Africa in all areas of the oil and gas industry,including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. In Russia, BP owns a 19.75% stake in Rosneft, the leader of Russia's petroleum industry and the world's largest publicly traded petroleum company by hydrocarbon reserves and production.
BP has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It has secondary listings on the Frankfurt Stock Exchange and the New York Stock Exchange.
Last year, BP established six major upstream projects, namely Clair Ridge, Western Flank B, Thunder Horse Northwest Expansion, Shah Deniz Stage Two, Taas-Yuryakh Expansion, and Atoll Phase One.
If you are looking to invest in the oil industry, which is not going away anytime soon,
there are some strong companies – big and small –worth considering.