MEOG: Aramco posts Q1 results

Saudi Aramco has announced plans to significantly increase its dividend payments this year, despite experiencing a 14% decline in quarterly profits, which fell short of market expectations. The company declared it would raise total dividends to $124.3bn for the year, marking a nearly 30% increase from last year’s $97.8bn, which itself was a 30% hike following the company’s record profits.

This strategic increase comes as Aramco reported first-quarter net income of $27.3bn, down from $31.9bn the previous year and slightly below the analysts’ forecast of $27.6bn. The drop was attributed to lower crude oil sales volumes and weaker refining and chemicals margins, despite higher oil prices compared to last year.

The substantial dividends are crucial for Saudi Arabia, where the state owns 82% of Aramco. The payouts are vital for funding ambitious state projects, including new cities and the world’s tallest skyscraper, as the kingdom aims to diversify its economy away from oil. Additionally, the Public Investment Fund, controlling a further 16% of Aramco, channels these funds into various mega projects across the country.