Maxim Semetov | Reuters Saudi oil giant Aramco reported a stunning 90% jump in second-quarter net income and record half-year results on Sunday, as high oil prices continue to produce historic windfalls for “Big Oil”. Aramco said strong market conditions helped push second-quarter net profit to $48.4 billion, from $25.5 billion a year earlier. The result easily beat analysts’ estimates of $46.2 billion. “Our record second quarter results reflect growing demand for our products — particularly as a low-cost producer with one of the lowest carbon intensities in the industry,” said Aramco President and CEO Amin Nasser. Aramco said half-year net profit jumped to $87.9 billion, easily beating the biggest listed oil companies, including Exxonmobil, Chevron and BP and other “Big Oil” companies, all of which are benefiting from a boom in commodity prices . Oil prices soared above $130 a barrel earlier this year as the global energy crisis, exacerbated by supply disruptions due to Russia’s invasion of Ukraine, roiled global markets and contributed to decades-high inflation. “While global market volatility and economic uncertainty remain, events in the first half of this year support our view that continued investment in our industry is necessary – both to ensure markets remain well supplied and to facilitate a smooth energy transition,” Nasser added. Aramco said it expects the post-pandemic recovery in oil demand to continue for the rest of the decade, despite what it called “downward economic pressures on near-term global forecasts.” The results of the explosion are also a major windfall for the Saudi government, which relies heavily on Aramco’s dividend to fund government spending. The Kingdom reported a budget surplus of $21 billion in the second quarter. Aramco said it would maintain its dividend payment of $18.8 billion in the third quarter, offset by a 53 percent increase in free cash flow to $34.6 billion.
Significant gains
Aramco is using its large profits to invest in its own production capabilities in both hydrocarbons and renewables while paying down its debt. “We are embarking on the largest capital program in our history, and our approach is to invest in the reliable energy and petrochemicals the world needs, while developing low-carbon solutions that can contribute to the broader energy transition,” the company said. Saudi Arabia, along with its OPEC+ counterparts, is under increasing pressure to boost oil production to ease high prices. Company executives said limited global spare capacity was a major concern for the global pricing outlook. Aramco said it achieved total hydrocarbon production of 13.6 million barrels of oil equivalent per day in the second quarter and is working to increase production capacity from 12 million barrels of oil per day to 13 million barrels of oil per day by 2027.
