Oil giant Saudi Aramco said on Sunday its profits jumped more than 80 percent in the first three months of the year, as the state-backed company benefits from volatility in global energy markets and higher oil prices in the wake of Russia’s invasion of Ukraine.
The bumper first-quarter profit of the company, officially known as the Saudi Arabian Oil Company, which overtook Apple as the world’s most valuable company last week, showed a record net income of $39.5 billion, up from $21.7 billion during the same period last year. . .
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The number represented the oil group’s highest quarterly profit since 2019, when the Saudi government, which owns 98% of the company, listed a portion of its value on the Riyadh Tadawul in what was then the world’s largest initial public offering.
In a statement, Aramco’s CEO attributed the surge in profits to higher prices as well as the kingdom’s increased production along with allies in the group known as OPEC Plus. It also appears to indicate that the turmoil caused by the war in Ukraine has underscored the vital role of oil and gas companies such as Aramco.
“In light of the increasing volatility in global markets, we remain focused on helping meet global demand for increasingly reliable, affordable and sustainable energy,” said President and CEO Amin Nasser, adding that Aramco is in the midst of an increase. Its maximum production capacity to meet the expected demand growth.
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Oil prices rose to a 14-year high of $139 a barrel in March immediately after Russia’s invasion of Ukraine, although they subsequently eased as Russian oil continued to flow and a renewed shutdown hurt demand for hydrocarbons in China, the largest importer. International benchmark Brent crude was trading more than $111 a barrel on Sunday.
Aramco shares jumped 1.85% on Sunday on the earnings report, with a share costing 41.40 Saudi riyals, or $11.04, on the Tadawul exchange. Aramco shares have risen since the start of the year, making it the most valuable company in the world last week with a market capitalization of about $2.43 trillion.
The oil group said it maintained a cash dividend of $18.8 billion for the fourth quarter of last year – completing one of the largest full-year cash dividends in the world. Payment is a primary source of revenue for the Saudi government.
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Gearing, which the company defines as the degree to which its operations are financed with debt, fell from 14% at the end of last year to 8% in the first quarter.
The strong quarterly results come after economic activity and the easing of global coronavirus restrictions returned to record annual results for the state-backed company last year after the devastation wrought by the pandemic and years of slow growth amid relatively low prices.
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High oil prices provided a welcome boost to the Saudi economy.
Saudi Arabia – the world’s largest oil exporter and de facto leader of OPEC – recorded its fastest economic growth in a decade during the first quarter of the year, as its gross domestic product grew by 9.6% compared to the same period last year, according to its statistics. an agency. The International Monetary Fund expects the kingdom’s economy to expand by 7.6% this year.