Saudi oil giant Aramco reported Tuesday a $26.9 billion profit in the third quarter, down slightly from last year as global energy prices remain depressed over concerns of too much oil being on the market.
Aramco’s results serve as a bellwether for the wider oil industry, which is still digesting the OPEC+ decision this weekend to halt planned production increases in the first quarter of next year over supply worries. Benchmark Brent crude, at just under $65 a barrel, has been fluttering near a four-year low.
In filing on Riyadh’s Tadawul stock exchange, Aramco, formally known as the Saudi Arabian Oil Co., reported overall revenue of $111 billion in the third quarter, compared with $123 billion in the same period last year. Its profit in the third quarter last year was $27.5 billion.
The figures slightly beat analysts’ projections.
“Aramco’s ability to adapt to new market realities has once again been demonstrated by our strong third quarter performance,” Aramco President and CEO Amin H. Nasser said in a statement. “We increased production with minimal incremental cost, and reliably supplied the oil, gas and associated products our customers depend on.”
Under IFRS accounting standards, Aramco reported a net profit of $27.9 billion based on an adjusted bookkeeping.
On Sunday, OPEC+ met and decided to increase its production by an additional 137,000 barrels of oil beginning in December. However, it said other adjustments planned in January, February and March of next year would be paused “due to seasonality.”
OPEC+ includes the core members of the cartel, as well as nations outside of the group led by Russia.
Aramco provides money crucial for Saudi Crown Prince Mohammed bin Salman ‘s expansive development plans for the kingdom, including hosting the upcoming FIFA 2034 FIFA World Cup.
Saudi Arabia’s vast oil resources, located close to the surface of its desert expanse, make it one of the world’s least expensive places to produce crude. For every $10 rise in the price of a barrel of oil, Saudi Arabia stands to make an additional $40 billion a year, according to the Institute of International Finance.
The Saudi government owns the vast majority of the firm’s shares. Saudi Aramco publicly listed a sliver of its worth back in late 2019 and has weighed offering more shares publicly.
—Jon Gambrell, Associated Press