Saudi Aramco’s profit jumps by 124% to $110 billion on higher oil prices

Saudi Arabian Oil Company (Aramco) says its net income increased by 124 percent to $110 billion in 2021, compared to $49.0 billion in 2020.

The company said the increase reflects higher crude oil prices, stronger refining and chemicals margins, and the consolidation of Saudi Basic Industries Corporation, SABIC’s full-year results.

Saudi Aramco has acquired a 70 percent majority stake in SABIC in 2020.

The oil company disclosed this in its 2021 financial results released over the weekend.

It also declared a fourth-quarter dividend of $18.8 billion — to be paid in the first quarter of 2022.

According to the financial statement, the national oil company’s capital expenditure in 2021 was $31.9 billion, an increase of 18 percent from 2020, primarily driven by an increase in oil production and prices.

Since 2021, global oil prices have posted gains, climbing above $130 per barrel recently on

Amin H. Nasser, Aramco president & CEO, said: “Our strong results are a testament to our financial discipline, flexibility through evolving market conditions and steadfast focus on our long-term growth strategy, which targets value growth for our shareholders.

“Although economic conditions have improved considerably, the outlook remains uncertain due to various macro-economic and geopolitical factors. But our investment plan aims to tap into rising long-term demand for reliable, affordable and ever more secure and sustainable energy.

“We recognise that energy security is paramount for billions of people around the world, which is why we continue to make progress on increasing our crude oil production capacity, executing our gas expansion program and increasing our liquids to chemicals capacity.

“We are also investing in carbon capture and storage, renewables and low-carbon hydrogen production — supporting the global energy transition and advancing our net-zero ambition.”

Since 2021, global oil prices have been recovering from the COVID-19 pandemic, hitting $85 per barrel in October and the recent surge above $100 a barrel following Russia’s invasion of Ukraine and accompanying sanctions by Western nations.

In Nigeria, subsidy payments, low production arising from oil theft and pipeline vandalisation eroded gains of higher oil prices.

Subsidy or under-recovery is the underpriced sales of premium motor spirit (PMS), better known as petrol.

Last year, petrol subsidy payments gulped N1.43 trillion, which affected revenue accrued to the federation account.

In 2020, the Nigerian National Petroleum Corporation (now a limited liability company) halted loss-making by posting a profit of N287 billion (about $600 million) for the first time in its over 40-year history — after adjusting a previous financial statement.