Aramco, the Saudi company, announces a 14.5% decrease in its net profit in the first quarter.

Saudi Aramco, the oil giant, reported a net profit of $27.27 billion in the first quarter, down 14.5% from the same period last year, due to ongoing oil production cuts by the Gulf kingdom.

The group stated in a document sent to the Saudi stock exchange that net profit for the first quarter of 2024 was 102.27 billion SAR ($27.27 billion), compared to 119.54 billion SAR ($31.88 billion) for the same quarter in 2023. It attributed this decline mainly to a decrease in the volume of crude oil sold.

Saudi Arabia, the world’s top oil exporter, currently produces around nine million barrels per day (bpd), well below its capacity of 12 million bpd, due to production cuts initiated since October 2022, when OPEC+ announced a reduction of two million bpd to stabilize prices.

In April 2023, Saudi Arabia and other OPEC+ members agreed to cut production by over one million bpd, followed by another million bpd reduction announced by Saudi Arabia after an OPEC+ meeting in June 2023.

In March, the Saudi Energy Ministry announced an extension of the latest reduction, which had begun in July 2023, until the second quarter of 2024, with a gradual restoration of reduced volumes based on market conditions.

Aramco, the flagship of the Saudi economy, is crucial to fund Crown Prince Mohammed bin Salman’s ambitious economic and social reform program known as Vision 2030, aimed at diversifying the country’s economy and preparing it for a post-oil era.

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