Skip to main content

Saudi Aramco profits jump 82 percent as oil prices surge

Aramco dethrones Apple as world's most valuable company, with shares worth $2.42 trillion compared to Apple's $2.37 trillion
Visitors stop at the Aramco exhibition section at the Misk Global Forum on innovation and technology held in the Saudi capital Riyadh on 13 November 2019 (AFP/File photo)

Saudi Aramco on Sunday posted an 82-percent jump in first quarter profits, stoked by a global surge in oil prices that has made it the world's most valuable company.

The announcement continued a string of recent positive economic news for Saudi Arabia, where a booming oil sector is fuelling the fastest growth rate in a decade.

Aramco's net income of $39.5 bn was up from $21.7 bn compared with the same period in 2021, "primarily driven by higher crude oil prices and volumes sold, and improved downstream margins", it said in a press release. 

US Senate committee passes bill pressuring Opec, Russia over high oil prices
Read More »

Later on Sunday, the finance ministry announced quarterly revenue growth of 36 percent compared with the same period in 2021, yielding a surplus equivalent to more than $15bn, state media reported

Aramco is Saudi Arabia's "crown jewel" and primary source of revenue.

The latest financial results were published four days after Aramco dethroned Apple as the world's most valuable company, with shares worth $2.42 trillion compared to Apple's $2.37 trillion.

Last year, ahead of the COP26 climate-change summit, Saudi Arabia pledged to achieve net zero carbon emissions by 2060, sparking scepticism from environmental campaign group Greenpeace.

With increasing global urgency to limit global warming, experts warn of the urgent need to reduce fossil fuel use.

In March, Aramco reported a 124 percent net annual profit increase for 2021. 

The firm has faced security challenges from the war which involves a Saudi-led military coalition against Yemen's Houthi rebels who have repeatedly targeted the kingdom, including Aramco sites.

A two-month truce in the war has generally been holding since it started in April, but in 2019 Houthi-claimed aerial assaults on two Aramco facilities in eastern Saudi Arabia temporarily knocked out half of the kingdom's crude production. 

A March attack by the Houthis on facilities of the largely state-owned firm caused a "temporary" drop in production. 

Oil-fuelled boom

The net income for the first quarter was a record for Aramco since its initial public offering in 2019.

Also on Sunday, Aramco announced it was issuing 20 billion bonus shares to shareholders - one share for every 10 shares already owned. 

A dividend of $18.8bn will be paid in the second quarter, it said. 

Biden to blame for US energy crisis, says former Saudi intelligence chief
Read More »

"Against the backdrop of increased volatility in global markets, we remain focused on helping meet the world's demand for energy that is reliable, affordable and increasingly sustainable," Aramco president and CEO Amin Nasser said. 

In early May, Saudi Arabia reported its fastest economic growth rate in a decade, as a booming oil sector fuelled a 9.6 percent rise in the first quarter over the same period of 2021.

The world's biggest oil exporter has resisted US entreaties to raise output in an attempt to rein in prices that have spiked since Russia's war in Ukraine began. 

As the war got underway, Saudi Arabia and the United Arab Emirates stressed their commitment to the OPEC+ oil alliance, which Riyadh and Moscow lead, underscoring Riyadh's and Abu Dhabi's increasing independence from long-standing ally Washington

Saudi Arabia's GDP is expected to grow by 7.6 percent in 2022, the International Monetary Fund said in April.

Saudi Arabia has sought both to open up and diversify its oil-reliant economy, especially since Mohammed bin Salman's appointment as crown prince in 2017. 

Aramco floated 1.7 percent of its shares on the Saudi Stock Exchange in December 2019, generating $29.4bn in the world's biggest initial public offering. 

In February, the kingdom shifted four percent of Aramco shares, worth $80bn, to the country's sovereign wealth fund - a move analysts saw as a possible prelude to further opening up the oil giant.

Middle East Eye delivers independent and unrivalled coverage and analysis of the Middle East, North Africa and beyond. To learn more about republishing this content and the associated fees, please fill out this form. More about MEE can be found here.