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Saudi Arabia has the most profitable company in the history of the world, and $3.2 trillion to invest by 2030. Who will say no to that tidal wave of cash?

By Vivienne Walt | Fortune Magazine | August 1, 2023

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This year’s Fortune Global 500 ranking of the world’s biggest companies at No. 2 sits Saudi Aramco, the Saudi Arabia’s state-owned oil giant, whose $604 billion in revenues last year dwarfed those of Amazon (No. 4) and Apple (No. 8).  And if Aramco’s trajectory continues, it could take the top spot next year. It is valued at over $2 trillion, and even more notable: Aramco’s net profits last year topped $159 billion. That makes it the most profitable business in the world.

To many Americans and Europeans, the dizzying wealth of a kingdom of 36 million people seems unrelated to their lives. If they think about Saudi Arabia at all, it may be for reasons the country prefers not to dwell on: Khashoggi’s killing, the jailing and torture of dissidents, the devastating war in Yemen, the vanished princesses whose plight was the subject of a recent New Yorker article, and the connection to the 9/11 attacks, in which 15 of the 19 perpetrators were Saudis.   Meanwhile, Saudi officials and business leaders paint a very different picture, portraying the country as thriving, modern, youthful. It’s a country whose 8.7% growth rate last year was the fastest of any big G20 economy, one that offers some of the most lucrative business opportunities anywhere.

Here’s the problem for Western investors and companies: Both versions are correct. That has sparked a complex set of calculations over which narrative—a repressive monarchy, or a land of opportunity—should prevail, and whether it is even possible to accommodate both. 

To human rights defenders, the answer is definitely no. To investors or those seeking Saudi investment, the answer is … fading from conversation, as the kingdom pours its oil profits into industries from golf to technology in increasingly brazen ways.

Aramco’s vast oil profits have driven sports investments including $700 billion in US Golf, nine-figure contracts the Saudi pro soccer league signed this summer with some star European players, and negotiations with international tennis organizations to host major tournaments in the kingdom. But while the sports deals have captured headlines, the real weight of Saudi Arabia’s growing global influence extends far beyond golf greens, soccer fields, and tennis courts.

With a hosepipe of cash from one of the world’s most crucial resources—hydrocarbons—the country has plowed tens of billions into foreign assets, some during the depths of the COVID-19 pandemic while Wall Street was reeling. “You don’t want to waste a crisis,” al-Rumayyan quipped at the time. 

The Saudis certainly did not. Their U.S. investments alone include more than 60% ownership of Lucid Motors, a California EV maker; stakes in rideshare company Uber (MBS was an early investor); and gaming companies Activision Blizzard and Electronic Arts. 

And that’s just the beginning: At the Paris conference, Badr al-Badr, a Saudi deputy minister of investment, estimated that the country has about $3.2 trillion to invest by 2030. MBS has mandated that investment entities create diversified portfolios, as part of his Vision 2030 strategy to lessen the country’s economic dependence on oil.

The potential for giant deals that are quickly executed has proved irresistible for companies big and small. For world leaders and business executives, that has provoked a fierce debate over whether it’s worth criticizing Saudi Arabia and risk forgoing such rich rewards. The question has grown more pronounced with the Ukraine war and rising inflation, since oil prices have a profound impact on the price of food, electricity, and much else—and as it has become evident that economic power will not likely usher in democracy.  Already, righteous expressions of outrage are melting in the face of a tidal wave of cash.

3 key takeaways from the article

1. This year’s Fortune Global 500 ranking of the world’s biggest companies at No. 2 sits Saudi Aramco, the Saudi Arabia’s state-owned oil giant, whose $604 billion in revenues last year dwarfed those of Amazon (No. 4) and Apple (No. 8).  And if Aramco’s trajectory continues, it could take the top spot next year.
2. Is Saudi Arabia a repressive monarchy or a land of opportunity? It’s both. And that creates a conundrum for business and world leaders.
3. While the sports deals have captured headlines, the real weight of Saudi Arabia’s growing global influence extends far beyond golf greens, soccer fields, and tennis courts.

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Topics:  Energy, Saudi Arabia, OPEC