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Saudi Aramco in Talks on More Investments in China

President & CEO of Saudi's Aramco, Amin H. Nasser, speaks during the opening session of the International Petroleum Technology Conference (IPTC), in Riyadh, Saudi Arabia, February 21, 2022. (Reuters)
President & CEO of Saudi's Aramco, Amin H. Nasser, speaks during the opening session of the International Petroleum Technology Conference (IPTC), in Riyadh, Saudi Arabia, February 21, 2022. (Reuters)
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Saudi Aramco in Talks on More Investments in China

President & CEO of Saudi's Aramco, Amin H. Nasser, speaks during the opening session of the International Petroleum Technology Conference (IPTC), in Riyadh, Saudi Arabia, February 21, 2022. (Reuters)
President & CEO of Saudi's Aramco, Amin H. Nasser, speaks during the opening session of the International Petroleum Technology Conference (IPTC), in Riyadh, Saudi Arabia, February 21, 2022. (Reuters)

Oil giant Saudi Aramco is in talks with partners in China about further investments in the country, CEO Amin Nasser said on Monday.

"China is an important part of Aramco's base," Nasser told reporters on the sidelines of a conference in Saudi Arabia.

"And we are currently in discussions with a number of our partners in China for more investment," he said, declining to disclose the nature or size of potential investments.

Nasser said last year that Aramco expects opportunities for further investment in downstream projects in China - the world's biggest importer of crude oil - to help the country meet its needs for heavy transport and chemicals, as well as lubricants and non-metallic materials.

He told the conference on Monday that while oil demand globally is close to reaching pre-pandemic levels, investment in the sector is inadequate to sustain global supplies in the short to medium term.

Aramco is working on boosting its maximum sustained capacity to 13 million barrels per day by 2027, Nasser told reporters, from 12 million bpd currently.

"It will be a gradual build from '25 to '27," he said.

The company will allocate more capital for investments, including to boost maximum sustained capacity and gas supply.

"We will have, very soon, an earnings call after we announce our numbers, and we will be explaining more about what we are doing," he said, responding to a question on whether Aramco would use rising income due to higher oil prices on capital expenditure or dividends.

"But definitely, more capital allocation for our investment," he said.

Nasser said total global investment in the oil and gas sector has halved since 2014 to $350 billion.

"You've seen what happened in Europe right now and parts of Asia in terms of energy prices going very high, impacting customers all over the world," he said.

"This is mainly because of the strategies and policies that curtailed investment in certain sectors ... only advocated and supported renewables and alternatives without reaching the point of realization that you need to support all energy sources over the long-term in order to ensure that there is adequate supply to support healthy growth."

Aramco completed the world's largest initial public offering in late 2019, raising $29.4 billion on the Riyadh bourse.

Saudi officials have previously raised the possibility of selling more shares in Aramco.

Responding to a question on whether further shares of Aramco would be sold in Saudi Arabia or abroad, Nasser said: "This is a government decision when the major shareholder to decide if they would like to list more of Saudi Aramco."

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US Economy Grew at Solid 3% Rate Last Quarter, Government Says in Final Estimate

FILE - The New York Stock Exchange, at rear, is shown on Sept. 24, 2024, in New York. (AP Photo/Peter Morgan, File)
FILE - The New York Stock Exchange, at rear, is shown on Sept. 24, 2024, in New York. (AP Photo/Peter Morgan, File)
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US Economy Grew at Solid 3% Rate Last Quarter, Government Says in Final Estimate

FILE - The New York Stock Exchange, at rear, is shown on Sept. 24, 2024, in New York. (AP Photo/Peter Morgan, File)
FILE - The New York Stock Exchange, at rear, is shown on Sept. 24, 2024, in New York. (AP Photo/Peter Morgan, File)

The American economy expanded at a healthy 3% annual pace from April through June, boosted by strong consumer spending and business investment, the government said Thursday, leaving its previous estimate unchanged.
The Commerce Department reported that the nation's gross domestic product — the nation's total output of goods and services — picked up sharply in the second quarter from the tepid 1.6% annual rate in the first three months of the year, The Associated Press reported.
Consumer spending, the primary driver of the economy, grew last quarter at a 2.8% pace, down slightly from the 2.9% rate the government had previously estimated. Business investment was also solid: It increased at a vigorous 8.3% annual pace last quarter, led by a 9.8% rise in investment in equipment.
The final GDP estimate for the April-June quarter included figures showing that inflation continues to ease, to just above the Federal Reserve’s 2% target. The central bank’s favored inflation gauge — the personal consumption expenditures index, or PCE — rose at a 2.5% annual rate last quarter, down from 3% in the first quarter of the year. Excluding volatile food and energy prices, so-called core PCE inflation grew at a 2.8% pace, down from 3.7% from January through March.
The US economy, the world's biggest, displayed remarkable resilience in the face of the 11 interest rate hikes the Fed carried out in 2022 and 2023 to fight the worst bout of inflation in four decades. Since peaking at 9.1% in mid-2022, annual inflation as measured by the consumer price index has tumbled to 2.5%.
Despite the surge in borrowing rates, the economy kept growing and employers kept hiring. Still, the job market has shown signs of weakness in recent months. From June through August, America's employers added an average of just 116,000 jobs a month, the lowest three-month average since mid-2020, when the COVID pandemic had paralyzed the economy. The unemployment rate has ticked up from a half-century low 3.4% last year to 4.2%, still relatively low.
Last week, responding to the steady drop in inflation and growing evidence of a more sluggish job market, the Fed cut its benchmark interest rate by an unusually large half-point. The rate cut, the Fed’s first in more than four years, reflected its new focus on shoring up the job market now that inflation has largely been tamed.
Some other barometers of the economy still look healthy. Americans last month increased their spending at retailers, for example, suggesting that consumers are still able and willing to spend more despite the cumulative impact of three years of excess inflation and high borrowing rates. The nation’s industrial production rebounded. The pace of single-family-home construction rose sharply from the pace a year earlier.
And this month, consumer sentiment rose for a third straight month, according to preliminary figures from the University of Michigan. The brighter outlook was driven by “more favorable prices as perceived by consumers” for cars, appliances, furniture and other long-lasting goods.
A category within GDP that measures the economy’s underlying strength rose at a healthy 2.7% annual rate, though that was down from 2.9% in the first quarter. This category includes consumer spending and private investment but excludes volatile items like exports, inventories and government spending.
Though the Fed now believes inflation is largely defeated, many Americans remain upset with still-high prices for groceries, gas, rent and other necessities. Former President Donald Trump blames the Biden-Harris administration for sparking an inflationary surge. Vice President Kamala Harris, in turn, has charged that Trump’s promise to slap tariffs on all imports would raise prices for consumers even further.
On Thursday, the Commerce Department also issued revisions to previous GDP estimates. From 2018 through 2023, growth was mostly higher — an average annual rate of 2.3%, up from a previously reported 2.1% — largely because of upward revisions to consumer spending. The revisions showed that GDP grew 2.9% last year, up from the 2.5% previously reported.
Thursday’s report was the government’s third and final estimate of GDP growth for the April-June quarter. It will release its initial estimate of July-September GDP growth on Oct. 30.