Saudi Aramco says 2020 profit slid 44.4% on lower crude prices

Energy giant Saudi Aramco on Sunday posted a 44.4 per cent slump in 2020 net profit due to lower crude prices, as the coronavirus pandemic weighed heavily on global demand.

“Aramco achieved a net income of $49 billion in 2020,” the company added in a statement, compared to $88.2 billion in the previous year.

Saudi Arabia, the world’s biggest crude exporter, was hammered last year by the double whammy of low prices and sharp cuts in production.

“The company displayed strong financial resilience in one of the most challenging periods for the industry,” the Aramco statement said.

“Revenues were impacted by lower crude oil prices and volumes sold, and weakened refining and chemicals margins.”

Crude prices have risen in recent weeks to over $60 per barrel.

But analysts say the Saudi giant is bracing for a possible further wave of coronavirus infections that could undermine a tentative global economic recovery and further erode global demand for crude.

Aramco, seen as Saudi Arabia’s cash cow, has revealed consecutive falls in profits since it began disclosing earnings in 2019.

That has piled pressure on government finances as Riyadh pursues ambitious multi-billion dollar projects to diversify the oil-reliant economy.

The company has cut its capital spending and slashed hundreds of jobs as it seeks to reduce costs, Bloomberg News reported last June.

(BSS)