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Saudi Aramco, the world’s largest oil company, reported a 12 per cent drop in profit in 2024 and cut its dividend in a blow to Saudi Arabia’s increasing budget deficit.
Saudi Aramco’s net income for the year was $106.25bn, compared with $121bn in 2023 as energy prices fell. It said it would pay a total dividend of just over $85bn, compared with $124bn in the previous year.
The oil major’s dividend has helped to fund Crown Prince Mohammed bin Salman’s economic transformation of Saudi Arabia, but the average oil price has fallen significantly from a high of more than $100 a barrel in 2022. Benchmark Brent crude was trading at $71 a barrel on Tuesday morning.
In addition, Saudi Aramco is sitting on several million barrels a day of spare capacity, after Saudi Arabia trimmed its production to help shore up oil prices. The company said that if Saudi Arabia decides to pump more oil, each extra million barrels of oil a day “could generate an additional $12bn in operating cash flow, based on 2024’s average price”.
On Monday, the Opec+ oil cartel agreed to the first oil production increase by the group since 2022. “Global oil demand reached new highs in 2024, and we expect further growth in 2025,” said Amin Nasser, Saudi Aramco’s chief executive.
