Picture used for illustrative purpose. AFP
Aramco, Saudi Arabia’s energy company posted on Tuesday a 44.6 % fall in third-quarter profit as a result of heavy demand for crude oil due to the coronavirus pandemic.
According to a statement by the company, the net income for the Q3 of 2020 was 44.21 billion Saudi riyals ($11.79 billion). In 2019, the company recorded a net income of $21.3 billion in the third quarter.
The company’s net profit for the first nine months of 2020 dropped by 48.6 per cent to $35.02 billion, it added.
The results show a gloomy oil market as lockdown due to the pandemic crush global demand for crude.
Aramco's July-September results showed an improvement compared to the second quarter, when it posted a profit of $6.57 billion.
"We saw early signs of a recovery in the third quarter due to improved economic activity, despite the headwinds facing global energy markets," Aramco's chief executive Amin Nasser said in the statement.
"We continue to adopt a disciplined and flexible approach to capital allocation in the face of market volatility. We are confident in Aramco's ability to manage through these challenging times and deliver on our objectives."
Nasser said Aramco was committed to delivering a dividend of $18.75 billion to shareholders for the third quarter -- an amount that exceeds the declared profit.
Aramco was listed on the Saudi bourse in December following the world's biggest IPO, generating $29.4 billion for 1.7 percent of its shares.
The energy giant is bracing for a possible further wave of coronavirus infections that could undermine a tentative global economic recovery and erode the demand for crude worldwide, analysts say.
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Upon closing, Aramco will receive upfront proceeds of around US$12.4 billion, further strengthening its balance sheet through one of the largest energy infrastructure deals globally.
Saudi's oil production from its Khurais plant is now at more than 1.3 million barrels per day, while current production from its Abqaiq plant is at about 3 million bpd, the source said.
Quoting Saudi Crown Prince Mohammed Bin Salman, SPA reported that the "transfer of four per cent of Aramco shares to the Public Investment Fund... is part of the kingdom's long-term strategy to support the restructuring of its economy".
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