Energy giant Saudi Arabian Oil Co (Aramco) yesterday posted a 44.6 percent slump in third-quarter profit as the COVID-19 pandemic weighs heavily on demand for crude oil.
“Net income for the third quarter of 2020 was 44.21 billion Saudi riyals [US$11.79 billion],” the company said in a statement, compared with US$21.3 billion in the same period last year.
Aramco’s net profit for the first nine months of this year also dropped 48.6 percent to US$35.02 billion, the company added.
The results underscore a downbeat oil market as pandemic-driven economic shutdowns crush global demand for crude.
The results are in line with analysts’ expectations, but stand in contrast to the losses reported by Aramco’s rivals, which are reeling from a drop in oil demand since the start of the COVID-19 pandemic.
Aramco’s results for the third quarter showed an improvement from the second quarter, when it posted a profit of US$6.57 billion.
“We saw early signs of a recovery in the third quarter due to improved economic activity, despite the headwinds facing global energy markets,” Aramco chief executive Amin Nasser said in the statement.
“We continue to adopt a disciplined and flexible approach to capital allocation in the face of market volatility. We are confident in Aramco’s ability to manage through these challenging times and deliver on our objectives,” he said.
Nasser said Aramco was committed to delivering a dividend of US$18.75 billion to shareholders for the third quarter — an amount that exceeds the declared profit.
Aramco was listed on the Saudi bourse in December last year following the world’s biggest initial public offering, generating US$29.4 billion for 1.7 percent of its shares.
The energy giant is bracing for a possible further wave of COVID-19 infections that could undermine a tentative global economic recovery and erode the demand for crude worldwide, analysts have said.
Saudi Arabia, the world’s biggest crude oil exporter, has been hit hard by the double whammy of low prices and sharp cuts in production.
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