Saudi Aramco, the world's leading oil-exporting company, posted a 4.6 per cent drop in first-quarter profit as oil prices remain under pressure from demand concerns and fears of oversupply.
The company’s three-month profit dropped to 97.5 billion Saudi riyals ($26 billion), from 102.2 billion riyals in the first quarter of 2024, Aramco said on Sunday in a filing to the Tadawul stock exchange, where its shares are traded.
Meanwhile, revenue rose less than 1 per cent during the period to 405.6 billion riyals “mainly due to higher volumes sold of gas and refined and chemical products, as well as higher traded volumes of crude oil”, the company said.
“This was partially offset by lower prices of refined and chemical products as well as crude oil compared to the same quarter of previous year.”
Brent crude futures remain extremely volatile on concerns that US President Donald Trump's tariffs regime and an ensuing trade war would hinder global economic growth and cut energy demand. The Opec+ alliance of oil producers increasing supply has also put crude prices under pressure.
“Global trade dynamics affected energy markets in the first quarter of 2025, with economic uncertainty impacting oil prices,” said Aramco president and chief executive Amin Nasser.
“Such periods also highlight the importance of disciplined capital planning and execution while we continue to take a long-term view.”
Aramco's results come after the Opec+ group announced a supply boost for the month of June, that is expected to put further downwards pressure on oil prices. The group of producers, led by Saudi Arabia and Russia, said it would add 411,000 barrels a day to the market next month. The announcement followed the larger-than-planned output rise, also of 411,000 bpd, for May.
Dividend payout
Aramco said it would distribute a base dividend of $21.1 billion, up 4.2 per cent year-on-year. A performance-linked dividend of $200 million will be paid in the second quarter. However, that is a steep decline from the payout of $10.8 billion for the same period last year.
"In volatile times Aramco's resilience underpins both our financial performance and our sustainable and progressive base dividend," Mr Nasser said.
For the Saudi government, the largest shareholder in Aramco, these dividends serve as a crucial source of revenue, helping to fund the national budget and economic diversification efforts.
The company reported cash flow from operating activities of $31.7 billion in the first quarter, compared to $33.6 billion in the same period last year. Free cash flow reached $19.2 billion in the first three months of 2025, down from $22.8 billion in the same period in the previous year.
Capital expenditure in the first quarter stood at $12.5 billion, up from $14.1 billion year-on-year, to support "long-term strategic growth", Aramco said.
"We continue to advance our growth strategy across upstream, downstream and new energies, while working to reduce emissions," Mr Nasser said.
The company has made progress on its gas production growth target, global retail expansion, petrochemical strategy, blue hydrogen business development and carbon capture projects, he said.
This year, Aramco has projected capital expenditure of between $52 billion and $58 billion, with an additional $4 billion in project financing. Last year’s capital investment totalled $53.3 billion, of which, $50.4 billion was organic capital expenditure.
The company has been pouring billions of dollars into the Jafurah unconventional gas project, east of Ghawar in Eastern Province, to support the kingdom's efforts to curb liquid burning for power generation.
Aramco is also pursuing opportunities in the global LNG market, including investing in projects and securing offtake agreements.
Oil prices jumped on Friday to settle higher and post their first weekly gain in three on the back of trade talks between the US and China that could ease tension between the world’s two largest economies and boost demand.
The increase also comes after Washington announced a new trade deal with the UK.
Brent, the benchmark for two thirds of the world's oil, closed 1.7 per cent higher at $63.91 a barrel. West Texas Intermediate, the gauge that tracks US crude, leapt 1.85 per cent to at $61.02 a barrel.
For the year to date, however, both benchmarks are still down by nearly 15 per cent.
