Tuesday 4 May 2021 10:06 am

Saudi Aramco beats forecasts as profit jumps 30 per cent on higher oil prices

State-run oil giant Saudi Aramco beat analysts’ forecasts today as first-quarter net profit rose 30 per cent amid the rise in oil prices.

Crude prices have climbed about a third this year due to recovering fuel demand, helping a host of oil firms post improved results.

“Given the positive signs for energy demand in 2021, there are more reasons to be optimistic that better days are coming,” Amin Nasser, chief executive of the world’s top oil exporter, said in a statement.

“And while some headwinds still remain, we are well-positioned to meet the world’s growing energy needs as economies start to recover,” he said.

Net income rose to $21.7bn for the quarter, up from $16.7bn a year earlier. It beat forecasts of net profit of $19.5bn.

Oil prices rose higher again today, with Brent crude up a further 1.0 per cent to above $68.

Aramco, which listed in 2019 with the sale of a 1.7 per cent stake mainly to the Saudi public and regional institutions, said earnings were boosted by stronger crude prices and higher refining and chemicals margins, helping offset lower production.

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Saudi Crown Prince Mohammed bin Salman has said more Aramco shares could be sold in the next year or two, including to international investors. He has said the kingdom was in talks to sell 1 per cent to a leading global energy company.

The OPEC+ alliance of major oil producing nations have cut output to support prices but last month agreed plans to start gradually easing those curbs from 1 May.

Aramco, which reduced its output as part of that pact and as a result of Saudi Arabia’s additional voluntary production cuts, said global demand for petroleum products was recovering from its lows in 2020 but remained below pre-pandemic levels.

Aramco declared a dividend of $18.8bn for the first quarter, to be paid in the second quarter, in line with company guidance of a $75bn dividend for this year.