March 5, 2024
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Saudi Aramco Oil Company ends the Second Quarter with a Record-Breaking Profit of $48.4 Billion

Saudi Aramco Oil Company ends the Second Quarter with a Record-Breaking Profit of $48.4 Billion

An oil company based in Saudi Arabia, Aramco, recently claimed the world’s profit record with a $48.4 billion profit at the end of the year’s second quarter. The government-owned company produces oil and gas in Saudi Arabia. Consequently, the company is looking to increase its daily production to meet up with surging world demands.

Saudi Aramco’s 90% profit increase

As a result of increasing demands and low cost of production due to unlimited access to oil fields, Saudi Aramco has recorded a 90% profit spike. This profit is recorded at the end of the last quarter and easily beats the company’s earnings since it was publicly listed three years ago. The Russia-Ukraine war and rising post-pandemic demands have caused a spike in the need for oil, and the prices have shot up. The company not only recorded that profit in its third year of being publicly listed, but it also broke the world’s record as being the first listed company ever to record such profit in a quarter.

Aramco has stated that it plans to keep its growth pace steady even as demands grow and global economic pressure increases. The company currently produces millions of barrels daily, very close to its maximum ratio, to meet the world’s needs.

The Saudi Arabia government sold a stake of 1.7% of its share to the public when it was publicly listed three years ago. The company’s recent profits are to compensate stakeholders with an $18.8 billion dividend. However, there are talks of the company launching to pay a Windfall tax which is a one-time charge required of companies that amassed extra profits due to factors beyond their control.

What does this mean for the Oil and Gas Industry

The global demand for oil and lessened dependency on Russian-produced oil and gas have seen an increased need for Saudi Aramco’s products. The company’s responsibility as a world oil and gas supplier has increased more than ever. It is also taking measures to make sure it is up to the task of supplying. Saudi Aramco hopes to ensure the continuity of supply to market and encourage an organized transition into energy. This decision was supported by OPEC when it agreed to raise oil production to meet increased world demand and lessen government burdens. Saudi Arabia’s economy will also witness a precedent economic increase and a growth of over 7.6% in 2022, its fastest economic growth in years. The sizeable profits have also helped the company channel its investments into renewable energy while paying off its debts and supporting government expenditure.

Conclusion

As the world moves closer to clean energy and away from dependency on fossil fuels, it expects that oil companies will be at the fore of promoting such change. Saudi Aramco has readily agreed to step up to the task. The company vows to do its best to meet the world’s demands and has continued to increase supply where necessary to aid the goal of energy transition ultimately.

Last Updated on 3 months by newseditor

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