To The Moon

How about investing an oil company ouside USA?

$Apple(AAPL)$ rarely fell more than 5%, but it did last night and made the total market cap to $2.37 trillion, the world's second. Whether it is the unexpected CPI in April, or some crypto crash in last two days, risk assets is not welcom anymore.

In contrast, with the oil price arising, Saudi Aramco, has benefited a lot,and successfully surpassed Apple to the world's largest listed company.

​Saudi Arabian National Oil Company (Saudi Aramco) is an integrated international oil company with a history of many years, mainly engaged in oil exploration, development, production, refining, transportation and sales. It is the largest oil production company in the world, and it is also the oil company with the largest proven reserves in the world at present, and its business covers the Kingdom of Saudi Arabia and the whole world.

In 1988, according to the royal decree, Saudi Arabian National Oil Company (Saudi Aramco for short) was formally established, taking over all the assets and management rights of the former Aramco, and becoming the only company engaged in oil exploration and development business in Saudi Arabia. After decades of operation, the Saudi government has successfully used American technology and capital to develop oil exploration, development, production, refining and other technologies, and at the same time built Saudi Aramco, a global integrated energy company, which has made itself the richest country in the Middle East.

Saudi Aramco's profits are significantly ahead of those of its peers. Since 2018, Saudi Aramco has been the most profitable company in the world, and controls the value of nearly every barrel of crude oil in the world with exaggerated oil benefits. And it represents almost the whole oil production capacity of Saudi Arabia.

Its average daily oil production capacity is expected to recover to 10,200 barrels per day in Q1 2022.

Since 2021, with the recovery of crude oil prices, Saudi Aramco's revenue and profits have hit new highs continuously. In 2021, revenue increased by 56% year-on-year, and net profit increased by 124% year-on-year due to scale effect

Since most of the shares are in the hands of the Saudi government, Saudi Aramco needs a lot of dividends when it makes money, and the amount of dividends is stable. In 2021, the annual profit was US $109.9 billion, and the dividend amount reached US $75 billion.

It is precisely because the state-owned state has a large stake that Vanguard Group, the largest external shareholder of Saudi Aramco, holds only 0.04% of the company's equity.

At present, Saudi Aramco is only listed in Saudi Arabia. Previous IPOs have considered the United States, Britain, Hong Kong and other places,  but the disclosure of oil reserves requires the intervention of agencies rather than Saudi Aramco's own disclosure, Saudi Arabia refused.

Therefore, if you want to invest in Saudi Aramco, you need to have the authority in Saudi Exchange. Although the Saudi currency rial has a fixed exchange rate with the US dollar, it is not easy for individual investors to enter the Saudi market.

Saudi Arabia's largest ETF in the US stock market is the Saudi stock index ETF is $iShares MSCI Saudi Arabia Capped ETF(KSA)$. Although Saudi Aramco's weight in KSA is only 5.1%, and the largest weighted companies are all local Saudi banks, all these banks depend on Saudi oil resources and related economic industries. Therefore, investing in this ETF is equivalent to investing in Saudi oil companies.

This ETF's return this year has reached 18.51%, much better compared to most European and US major markets.