On Sunday, the Saudi Arabian oil company, Aramco, released its financial report for the year 2023, revealing a profit of $121 billion.
Gatekeepers News reports that this is a decline from its previous year’s record of $161 billion, which can be attributed to the lower energy prices.
Despite the decline, the company’s performance still stands as its second-highest ever reported, owing to the OPEC+ alliance’s production cuts aimed at elevating global energy prices.
However, the lower profits may affect the nation’s ambitious development project since it is trying to reduce its dependence on oil revenue.
It is worth noting that Aramco’s $161 billion profit in 2022 was the largest ever reported by a publicly traded company.
“The decrease mainly reflects the impact of lower crude oil prices and lower volumes sold, and weakening refining and chemicals margins,” the company said in its filing to the Tadawul stock market.
Despite being lower this year, Aramco boosted the dividends due to its stockholders to over $31bn in the fourth quarter, according to filings. The energy giant had planned a conference call on Monday to discuss its results. Aramco reported overall revenue of $440bn last year, down from $535bn in 2022.
“Our resilience and agility contributed to healthy cash flows and high levels of profitability, despite a backdrop of economic headwinds,” said Aramco CEO Amin Nasser, in a statement.
Aramco, formally known as the Saudi Arabian Oil Co., put its output at 12.8 million barrels of oil a day. The company has been ordered by the Saudi government to keep its production there despite earlier plans to increase output.
Saudi Arabia, a leader in the OPEC cartel, has allied with Russia and others outside of the group to try to keep production down to boost global oil prices. Benchmark Brent crude traded under $82 a barrel on Sunday.
Aramco has a market value of $2tn, making it the world’s fourth most valuable firm, behind Apple, Microsoft and NVIDIA respectively. Aramco stock traded slightly up on the Tadawul at $8.64 a share Sunday.
Saudi Arabia’s vast oil resources, located close to the surface of its desert expanse, make it one of the world’s least expensive places to produce crude.
Crown Prince Mohammed bin Salman hopes to use the oil wealth to pivot the kingdom off oil sales, such as with his planned $500bn futuristic desert city, called Neom, and other projects.
Meanwhile, activists criticised the profits amid global concerns about the burning of fossil fuels accelerating climate change.
On Thursday, Prince Mohammed transferred another eight per cent of Aramco shares to the country’s prominent sovereign wealth fund, worth over $160bn.
The vast majority of the company remains held by the Al Saud royal family, with silver traded on the Tadawul stock market.
