Saudi's Oil Giant Aramco Earns Profit Of $32.6 Billion In Q3, Falls 23% As Lower Crude Prices, Volumes Drag

State-owned petroleum and natural gas company of Saudi Arabia, Aramco posted over 23% drop in its net profit to $32.6 billion during the third quarter of 2023. The profitability was impacted due to lower crude oil prices and volumes. The oil giant has also declared dividends for its shareholders.

In the Q3 of 2022, Aramco had earned a profit of $42.4 billion.

Furthermore, in Q3 of 2023, the company's cash flow from operating activities declined massively to $31.4 billion compared to $54 billion. Also, free cash flow dipped to $20.3 billion as against $45 billion in Q3 last year.

During the quarter, average realized crude oil prices stood at $89.3 per barrel versus $101.7 per barrel in Q3 of last year.

In regards to dividends, Aramco said, a Q2 base dividend of $19.5 billion paid in the third quarter, while the Q3 base dividend of $19.5 billion is to be paid in the fourth quarter.

The company highlighted that the first performance-linked dividend distribution of $9.9 billion was paid in Q3, while the second distribution of approximately $9.9 billion was to be paid in Q4 based on combined full-year 2022 and nine-month 2023 results.

Amin H. Nasser, President and CEO said, "Our robust financial results reinforce Aramco's ability to generate consistent value for our shareholders, and we continue to identify new opportunities to evolve our business and meet the needs of customers."

He added, "During the third quarter we agreed to make our first international investment in liquefied natural gas (LNG) to capitalize on rising LNG demand, and announced our intention to enter the South American retail market. These planned investments demonstrate the scale of our ambition, the broad scope of our activities, and the disciplined execution of our strategy. I am excited by the progress we are making, which I believe will complement both our Upstream capacity expansion and our growing Downstream presence."

Aramco's strategic expansion continues with agreement on the first international LNG investment, and the plan to enter the South American market through a downstream retail acquisition.

Moreover, Aramco increased raw gas processing capacity by 800 million standard cubic feet per day (mmscfd), including approximately 750 mmscfd of sales gas processing capacity, through Hawiyah Gas Plant expansion. Further, its collaboration with Stellantis indicates eFuel compatibility with 24 engine families in Europe.

Looking ahead, Nasser said, "We intend to continue investing across the hydrocarbon chain, leveraging cutting-edge technologies to optimize our operations and advance the development of emerging energy solutions. It is an approach rooted in our belief that a balanced and realistic energy transition plan should consider the needs of all geographies, in order to avoid disparities between global energy consumers."

On November 7, Aramco's share price listed on the Saudi Exchange settled at riyal 33.60 per share, up by 0.5%.