study case / business analysis of Saudi aramco. Project contains: Part I: COMPANY’S OVERVIEW · Firm Presentation (name - location - type – size, history…): Company Name: The Saudi Arabian Oil Company Type of business: Energy and Petrochemical industry Date of creation: 29 May 1933 (90 years) Type of Company: Public for-profit company Founder(s): The Government of Saudi Arabia Current CEO: Amin Hassan Nasser Head office address: Dhahran, Eastern Province, Saudi Arabia Main products/services: Exploration, production, refining and distribution of oil and natural gas / Petrochemicals / Solar and wind energy Number of employees: 70000 (2023) Main Markets: Asia & Far East Export percentage: Asia (76%), Western Europe (11%), North America (8%), etc.  Annual Revenue: Est. 2022 annual revenue 552.25 billion$ Market capitalization: 1.927 Trillion $ (2023) Strengths : Second-largest proven crude oil reserves at more than 270 billion barrels => Large resources Largest daily oil production of all oil-producing companies => Efficient production process Most valuable company in the world by market cap, surpassing Apple in May 2022 New market acquisition : Kenya through Valvoline (local presence)  Large global presence with offices in Asia, Europe and the Americas. Important research investments : Funding global research centers - Lately a 14 million$ investment on drones · Missions, Values, goals… · Performance indicators: Revenues, market share, result…… - Presentation of the sector (industry) in which the company operates: - External analysis in terms of opportunities and threats using: swot analysis (strength,weakness, opportunity,threats), porter's five forces, Product Mix (4PS: product lines , price , promotions, place) ,PESTEL analysis, STP analysis (segmentation , targeting and positioning ).

2. Saudi Aramco
a business analysis

3. BUSINESS
PROFILE

4. Business Profile:
• Company Name: The Saudi Arabian Oil Company
• Type of business: Energy and Petrochemical industry
• Date of creation: 29 May 1933 (90 years)
• Type of Company: Public for-profit company
• Founder(s): The Government of Saudi Arabia
• Current CEO: Amin Hassan Nasser
• Head office address: Dhahran, Eastern Province, Saudi Arabia
• Main products/services: Exploration, production, refining and distribution of oil
and natural gas / Petrochemicals / Solar and wind energy
• Number of employees: 70000 (2023)
• Main Markets: Asia & Far East
• Export percentage: Asia (76%), Western Europe (11%), North America (8%), etc.
• Annual Revenue: Est. 2022 annual revenue 552.25 billion$
• Market capitalization: 1.927 Trillion $ (2023)

5. SWOT

6. SWOT Analysis
Strengths :
• Second-largest proven crude oil reserves at more than 270 billion barrels
=> Large resources
• Largest daily oil production of all oil-producing companies => Efficient
production process
• Most valuable company in the world by market cap, surpassing Apple in
May 2022
• New market acquisition : Kenya through Valvoline (local presence)
• Large global presence with offices in Asia, Europe and the Americas.
• Important research investments : Funding global research centers - Lately
a 14 million$ investment on drones
Weaknesses :
• Single greatest contributor to global carbon emissions of any company in
the world since 1965
=> Bad public image and lack of corporate social responsability.
• Product line highly dependent on natural resources and undiversified.
• Stock price is fragile after COVID-19
• Transparencty issues in reports (prevented from listing on the stock
exchange) and strong political ties to Mohammed Bin Salman's efforts
to paint a vision for Saudi Arabia 2030.
Opportunities :
• Saudi Aramco has the opportunity to grow in its field thanks to the
global increase in the demand for energy and even the increase on
fuel dependency.
• Rising demand of oil in Asia.
Threats :
• if the population start converting into renewable eco-friendly sources
of energy, the company may face a large drawback as their products are
not safe for the environment
• The Middle East region's political instability.
• The oil's price surge in the last few years.

7. PESTEL

8. PESTEL
Political:
• (-) Saudi Arabia is an absolute monarchy and the government holds significant control over the country's
economy, including the oil and gas sector.
• (+) Saudi Arabia is a key player in the global oil market and its political stability is important for the energy
industry.
Economic:
• (+) Global demand for oil and gas is a major factor affecting its performance, especially after the Russian
invasion of Ukraine.
• (-) Saudi Arabia's economy is heavily dependent on oil revenue, and any changes in the oil market can affect
the government's ability to invest in and support the company.
Social:
• (-) The company has been facing criticism over its environmental impact
Technological:
• (+) Technological progress is improving the company's efficiency (advanced drilling techniques)
Environmental:
• (+) The company is working to reduce its carbon emissions and invest in renewable energy.
• (-) Climate change and extreme weather conditions may affect its operations
Legal:
• (-) Saudi Aramco is subject to a variety of laws and regulations related to the oil and gas sector, including
environmental regulations and labor laws.
• (-) The company is facing potential lawsuits related to environmental damage, human rights and other legal
issues.
• (-) The company must also comply with international trade laws and sanctions.

9. Porter’s 5
forces

10. Bargaining Power of
Suppliers
Threats of New
Entrants
Bargaining Power
of Buyers
Threat of Substitute
Products
Rivalry
Among
Competitors
RivalryAmong Competitors :
•
Bargaining Power of Suppliers : LOW
 Saudi aramco is fully integrated
 Monopoly : its own supplier
 No suppliers that have power over
them
Threats of New Entrants : LOW
 Barriers to entry
 Strong and well established
brand name
 High capital requirements
 Total government support
 They own major distribution
channels
Threat of Substitutes : MEDIUM
 Alternative fuel energy sources
 Switching cost not very low
Bargaining Power of Buyers :
•

11. Porter’s 5 forces
1.Threat of New Entrants: l
•High barriers to entry due to the large capital investments and technology required to enter the oil
industry.
•The government's control over the industry through Saudi Aramco acts as a barrier to entry for new
competitors.
2.Threat of Substitute Products:
•Moderate to high threat due to the increasing shift towards renewable energy sources and alternative fuel
options.
3.Bargaining Power of Suppliers:
•Low bargaining power as the company has a dominant position in the global oil market and large reserves
base.
4.Bargaining Power of Buyers:
•Moderate bargaining power due to the presence of a few large buyers and a considerable number of
IN DETAIL

12. 1.The Threat of new entrants : which is very LOW
And this is because the intial barriers to enter this industry are very high and can scare away most companies due to the very
large capital that it requires.
Not only that but competing with industry giants like Saudi Aramco is an extremely hard task . The company already has a very
well established name , international market domination and a huge financial muscle.
It is also state owned which means that the firm has total government support , huge investments and major distribution
channels which places them at an obvious advantage
and since they are fully backed by the goverment when it comes to running their buinsess , they are favored and have almost 0
legal restrictions to worry about , placing them at an obvious advantage …
2. Moving on to the threat of Substitute Products : which is quite moderate
Substitutes for the energy resources that Saudi Aramco provides include like coal, hydroelectricity , renewable energy
and even nuclear energy.
These alternatives sources can replace an important amount of the world’s huge demand to hydrocarbons or oil in
general but one other factor to consider is the switching cost , only if it is low then this poses a serious threat .Which is
not the case for all of the mentioned alternatives . Switching to renewable or nuclear energy is not very cheap  which
makes the threat of substitutes quite moderate.

13. 3. And now for the Bargaining Power of Suppliers:​
which is how much pressure suppliers can place on a business and in this case it is LOW :
Saudi Aramco is a fully integrated company which means that it acts as MONOPOLY so it is its own a supplier in
a sense and doesn’t really rely on other external entities.
As mentioned before , it is state owned and it holds enormous oil reserves within the country, an excess
actually making it the top 1 oil exporter in the world meaning that they themselves have a very large supplier
power .

14. 4 Ps

15. Marketing Mix : The 4 p's

16. STP