FILE PHOTO: The Saudi Aramco logo is pictured at Hyvolution exhibition in Paris, France, February 1, 2024. REUTERS/Benoit Tessier/File Photo
Riyadh, Saudi Arabia — Energy giant Saudi Aramco reported a 15 percent year-on-year drop in third quarter profit on Tuesday, citing low oil prices.
The fall in net income to $27.56 billion this year from $32.58 billion in 2023 “was mainly due to the impact of lower crude oil prices and weakening refining margins”, the firm said in a statement posted to the Saudi stock exchange.
Saudi Arabia, the world’s biggest crude exporter, is currently producing roughly nine million barrels per day (bpd), well below its capacity of 12 million bpd.
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This reflects a series of output cuts since October 2022.
On Sunday Saudi Arabia and seven other members of the OPEC+ group of oil-producing nations said they were extending a 2.2 million-barrel reduction announced in November 2023 by another month, until the end of December.
“Aramco delivered robust net income and generated strong free cash flow during the third quarter, despite a lower oil price environment,” chief executive Amin Nasser said in a statement.
The firm was striving “to cement our position as a leading global energy and petrochemicals player”, he added.
Aramco is the jewel of the Saudi economy and the main source of revenue for Crown Prince Mohammed bin Salman’s Vision 2030 reform agenda, which aims to set the Gulf kingdom up for a prosperous post-oil future.
Its profits help finance flagship projects including NEOM, the planned futuristic mega-city being built in the desert, a giant airport in Riyadh and major tourism and leisure developments.
Aramco reported record profits in 2022 after Russia’s invasion of Ukraine sent oil prices soaring.
But its profits dropped by a quarter last year because of lower oil prices and production cuts.
Profits were down 14.5 percent in the first quarter of this year and 3.4 percent in the second quarter.