With the recovery of crude oil prices, global oil giant Saudi Aramco also submitted an eye-catching report card in the first quarter.
Saudi Aramco made a huge profit of 150 billion in the first quarter
On May 4, the Saudi state-owned oil company Saudi Aramco released its latest first-quarter financial results.
Data show that in the first quarter of this year, Saudi Aramco’s net profit increased by 30%, that is, from US$16.6 billion last year to US$21.7 billion. In other words, in the first three months of this year, Saudi Aramco made a net profit of US$21.7 billion, or about 151.2 billion yuan, which is equivalent to a net profit of nearly 1.7 billion yuan a day, and a net profit of nearly 20,000 yuan every second. It can be called “Money Printing Press”.
In fact, despite the decline in oil production of Saudi Aramco in February and March this year, Saudi Aramco’s performance in the first quarter It also exceeded market expectations of US$17.24 billion and was close to the US$22.2 billion level in the first quarter of 2019, the year before the oil price crash.
The market generally believes that this is also a sign of the company’s continued recovery from the crude oil market slump last year, which caused the company’s full-year net profit to be halved.
Saudi Aramco reported in the first quarter of last year that its net profit fell by 25% in the first quarter of 2020 due to the impact of the epidemic and the decline in global oil demand.
In addition, data also shows that in the first quarter of this year, Aramco’s cash flow was US$18.3 billion, much higher than the US$15 billion in the same period last year.
Benefiting from the sharp rebound in national oil prices
For the strong recovery of performance in the first quarter of this year, Saudi Aramco The financial report stated that profit growth was mainly driven by the strong oil market and higher refining and chemical profit margins.
As Saudi Aramco said, 2020 is the “most challenging year” in its history. Oil prices fell by more than a fifth in 2020 as oil demand plummeted last year as anti-epidemic lockdowns were implemented around the world, triggering a collapse in energy prices.
Affected by this, as the world’s largest oil exporter, Saudi Aramco’s net profit fell 44.4% year-on-year to 183.76 billion in the fiscal year ended December 31. Yar (approximately $49 billion).
As the economy gradually recovers from the impact of the epidemic, the international benchmark Brent crude oil futures price has increased by nearly 70% since November last year, and the increase in U.S. WTI crude oil futures has also reached approximately 70%. More than 65%.
Judging from the current crude oil price, it has returned to the price range of 2019, fluctuating within a narrow range around $60, and the Brent crude oil futures price is approximately twice that of the same period last year. . “The momentum provided by the global economic recovery has strengthened energy markets,” Saudi Aramco President and CEO Amin Nasser said at a company news conference on Tuesday. “Some Headwinds remain,” but he said: “Given the positive signs for energy demand in 2021, we have more reasons to be optimistic that better days are ahead.”
OPEC+ and An alliance of major oil producers, including Russia, decided last month to maintain a previously approved action plan to further ease production curbs from May.
In the first quarter of 2021, Saudi Aramco’s average total oil and gas production was 11.5 million barrels per day, including 8.6 million barrels of crude oil per day.
On the other hand, the company has announced a number of asset sales in the past few months. The latest is Saudi Crown Prince Salman’s announcement at the end of April that he would sell 1% of Aramco’s shares to a “leading global energy company.”
In mid-April, the company signed an agreement to sell a 49% stake in its pipeline to a U.S.-led consortium, EIG Global Energy Partners.
In fact, as global oil demand increases and oil prices rise, large oil companies that have been on thin ice in 2020 are regaining their footing. Royal Dutch Shell (Shell), Exxon Mobil Exxon Mobil and Vitol are both expected to post profits in the first quarter of 2021, giving analysts hope that the oil and gas industry will have a strong performance this year.
Domestic three-barrel oil performance rebounded sharply in the first quarter
Not only foreign, but also international oil prices have rebounded since the beginning of this year The continuous rise since then has also caused the domestic “three barrels of oil” first-quarter performance to rebound sharply compared with the same period last year.
PetroChina’s 2021 first quarter report disclosed on April 29 showed that it achieved operating income of 551.923 billion yuan, a year-on-year increase of 8.4%; the net profit attributable to shareholders of the parent company was 27.721 billion yuan, Compared with the net loss of 16.230 billion yuan in the same period last year, the profit increased by 43.951 billion yuan, the best level in the same period in the past seven years.
On April 28, Sinopec released its performance report for the first quarter of 2021. The net profit attributable to the company’s shareholders reached 18.543 billion yuan. The operating performance for the quarter turned a year-on-year loss, which was also better than that of 2019. year-on-year level.
中�The main operating indicators for the first quarter announced by China Oil on April 22 showed that during the reporting period, the total net production was 137.7 million barrels of oil equivalent, a year-on-year increase of 4.7%. The average realized oil price was US$59.07/barrel, a year-on-year increase of 20.5%. Driven by rising international oil prices and increased sales volume, CNOOC’s unaudited oil and gas sales revenue reached approximately 48.34 billion yuan, a significant year-on-year increase of 21.0%.
Crude oil funds led the performance during the year
Despite recent price fluctuations , crude oil remains one of the best-performing commodities on the market this year. Against this background, the oil and gas QDII fund, which had the lowest performance last year, has seen its performance bottom out this year.
Data show that as of the end of last year, WTI crude oil closed down 48.42 US dollars per barrel from 61.6 US dollars per barrel at the beginning of last year, an annual decrease of 21%, and Brent crude oil closed down from 66.41 US dollars at the beginning of last year. The U.S. dollar/barrel closed down by $51.72/barrel, an annual decline of 22%.
Affected by this, the overall performance of oil and gas QDII last year was at the bottom. Nine of the ten companies with the lowest return rate were crude oil-themed funds or products that mainly allocated commodities such as crude oil. , three oil and gas QDIIs had the largest annual net value declines of even more than 50%.
However, since 2021, the performance of this type of fund has ushered in a brilliant rebound, soaring from the bottom to the leading position. Wind data shows that as of April 30, the product with the highest growth rate during the current year among QDII funds has achieved an annual return rate of 40.09%. In addition, the performance of other crude oil-themed QDII products is not inferior, and the vast majority of crude oil and energy QDII funds have a return rate of more than 20%.
International investment banks continue to be bullish on oil prices
In the past April, the crude oil market experienced a process from oscillation to strength. Brent crude oil has always oscillated at 61-68 US dollars per barrel. However, as the oscillation time continues, the market adjustment has also come to an end.
Brent crude oil hit $68/barrel twice. The first time it failed, it adjusted to $65/barrel and then launched a charge again. After that, the price of crude oil in the United Arab Emirates was about to decrease. The sharp rise was stimulated by the news about production.
Recent market reports from Goldman Sachs and Morgan are extremely optimistic about oil prices in the third quarter, and their core views are almost identical. The main bullish logic lies in the popularization and promotion of vaccines in the third quarter. , market demand will recover quickly, but at the same time, the growth of the supply side is slow. The growth of demand will, to a certain extent, cause global supply to become tighter, and global crude oil inventories will also usher in the second quarter. A wave of rapid destocking will occur for commodities including crude oil and copper, and the world will once again enter a bull market for commodities.
Goldman Sachs predicts that Brent prices will reach US$80/barrel in the third quarter, WTI prices will reach US$77/barrel, and copper prices will exceed US$11,000/ton in the first quarter of next year. . Although Morgan’s price predictions are not as aggressive as Goldman Sachs’, they will maintain a steady upward trend over the next year.
Morgan also said that as the economy reopens in the second and third quarters, the world will shift from buying metal-intensive goods to buying oil-intensive services, such as driving and dining out. , visiting friends and traveling. The United States will grow faster than many other countries this year and will be one of the main drivers of the ongoing global economic recovery.
Europe will join the United States from May to June and embark on the road to recovery. Overall, rising demand means inventories will continue to draw even as OPEC+ brings 2 million barrels per day of production back to the market. A boost in U.S. demand in the second quarter should bring OECD inventories to the five-year average in April, a month earlier than previously expected.
UBS Group also stated that OPEC+ still fully controls the oil market, saying that it will only gradually withdraw production cuts and adopt a cautious approach. It is expected that Brent crude oil will fall in the second half of the year. Will hit $75/barrel.
The investment bank analyst believes that global oil consumption will rise from approximately 94 million barrels per day to more than 99 million barrels per day in the second half of the year, as vaccinations accelerate and restrictive measures are reduced will benefit demand.
UBS believes that the market is severely undersupplied this year, and the decline in inventories supports this view, “We reiterate long Brent crude oil for investors with higher risk tolerance suggestions”. But if rising coronavirus infections lead to an extension of restrictions, weighing on crude demand, oil prices could fall. </p
