Saudi Aramco profits shot up after the global rebound from Covid spurred an oil price rally.
The state-backed energy firm made £22billion in the three months to September. This was more than double the £8.6billion it brought in during the same quarter of 2020 – when many countries were still in lockdown.
The company was worth £1.5trillion last night as shares in the group came within touching distance of the all-time high of 38 riyals (740p). Its stock plunged to 29 riyals at the end of March.
Aramco’s quarterly profits are the highest since it went public in late 2019
Last year’s pandemic caused oil prices to plummet, bringing an end to international travel and temporarily closing down factories. But vaccine rollouts and a rebound in the global economy have seen prices hit eight-year highs.
The value of a crude barrel has increased from its April 2020 lows of $19 to $84 now.
Aramco did not use blockbuster profits from the third quarter to increase its dividend – sticking to its commitment to hand out £13.4billion to shareholders. Its bumper numbers come as global leaders meet in Glasgow for the Cop26 summit to discuss creating a world beyond fossil fuels.
Boss Amin Nasser said that the company’s “exceptional” performance was due to the’rebounding energy demand worldwide. Aramco pumped out around 9.5m barrels of oil a day during the three months – or around 10 per cent of global daily consumption.
Aramco plans on increasing its production to approximately 13m barrels per day by 2027, despite calls for the world not to use fossil fuels.
It has also laid out plans for its operations to be net zero carbon – meaning the emissions produced are fully offset – by 2050.
It also stated that it holds a 30% stake in Sudair, a large solar plant, which will begin producing power next year.
All major oil companies are under pressure for green energy transitions to be made quickly.
Royal Dutch Shell – which posted disappointing results last week – has come under fire from activist investor Third Point.
The US hedge fund is calling for Shell to split into multiple companies – formally separating its oil and renewables businesses, though Shell maintains the only way to fund its renewables transformation is to use oil money.
Tomorrow Rival BP will release its third quarter performance in a trading update.
Saudi Aramco pumps out approximately one in eight barrels oil and estimates that its reserves could last 52 years.
The company’s origins date back to 1933, when a contract was signed between Saudi Arabians and the Standard Oil Company of California. Chevron was later created.