Profits Decline Due to Lower Oil Prices
Saudi Aramco, the state-owned oil giant, posted third-quarter profits of $27.5 billion, a 15% drop from last year’s $32.5 billion during the same period. The decrease is attributed to declining global oil prices and reduced refining margins, which have impacted the company’s revenue stream.
Quarterly Revenue Dips Slightly
Aramco reported revenues of $111.1 billion for the third quarter, slightly down from $113 billion last year. The company filed these results with the Tadawul stock exchange in Riyadh, noting that lower oil prices have affected overall performance.
Year-to-Date Profit Overview
For the first nine months of 2024, Aramco’s profits reached $83.9 billion, down from $94.5 billion in the same period the previous year. This decrease reflects a global trend of lower oil demand, as factors such as eased Middle Eastern tensions and a slowdown in China’s economy affect prices.
Dividend Payouts Remain Strong
Despite the profit decline, Aramco will distribute $20.28 billion in third-quarter dividends, along with a performance-linked dividend of $10.77 billion. The company has set a total annual dividend goal exceeding $124 billion.
Government Ownership and Global Market Impact
While only a small portion of Aramco is publicly traded, the Saudi government holds the majority stake, using its profits to support state expenditures and the royal family. Aramco’s market value stands at $1.7 trillion, making it the sixth-most valuable company globally, with shares currently trading around $7.31, down from a high of over $9 earlier this year.
Economic Plans and Environmental Concerns
Saudi Arabia is reportedly reassessing parts of its ambitious economic projects, such as the $500 billion Neom city, due to the impact of lower oil prices. Meanwhile, environmental activists continue to voice concerns over Aramco’s role in fossil fuel production, advocating for a shift toward sustainable energy to combat climate change.
