Aramco profit soars to $25.5bn, highest since 2018

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Saudi Aramco profits rose from a year earlier to SR95.47 billion ($25.46 billion) in the second quarter as a recovering global economy pushed up oil prices and allowed the Kingdom to pump more crude.

It represents a 288 percent increase, and was affiliated with higher oil prices and a recovery in global demand, supported by the easing of COVID-19 restrictions, vaccination campaigns, stimulus measures, and accleerating activity in key markets, the oil giant said in a Tadawul filing.

This was slightly above median economist estimate of $24.7 billion – Bank of America predicted $24 billion; JPMorgan estimated $23.7 billion, while Alrajhi Capital forecast $25.3 billion.

“Our second quarter results reflect a strong rebound in worldwide energy demand and we are heading into the second half of 2021 more resilient and more flexible, as the global recovery gains momentum,” Aramco Chief Executive Officer Amin Nasser said.

“While there is still some uncertainty around the challenges posed by COVID-19 variants, we have shown that we can adapt swiftly and effectively to changing market conditions,” he added.

The company declared a dividend of SR70.33 billion.

Aramco’s indicated dividend yield is roughly 4 percent, while BP, Chevron and Exxon Mobil Corp. all pay above 5 percent.

The price of a barrel of Brent crude, the international benchmark, has risen about 40 percent this year and closed at $70.70 on Friday after its biggest weekly decline in four months.

The oil giant also benefitted from its strategy to optimize its portfolio, announcing billion dollar deals in recent months.

“Our historic $12.4 billion pipeline deal was an endorsement of our long-term business strategy by international investors, representing significant progress in our portfolio optimization program. Our landmark $6 billion Sukuk reinforced our robust balance sheet, further diversifying our funding sources and expanding our investor base. And, once again, we delivered a dividend of $18.8 billion for our shareholders,” Nasser said.

He said the company will move forward on a number of strategic programs, particularly focusing on sustainability and low-carbon fuels.

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