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Saudi state oil group Aramco’s profit plunged 73 per cent in the second quarter of the year, as a slump in energy demand and prices due to the coronavirus crisis hit sales at the world’s biggest oil exporter. All major oil companies have taken a hit in the second quarter as lockdowns to contain the coronavirus limited travel, which reduced oil consumption and sent prices tumbling to levels not seen in nearly two decades.
Aramco, which listed in Riyadh last year in a record $29.4 billion flotation, said the rapid spread of COVID-19 globally had significantly reduced demand for crude oil, natural gas and petroleum products.
‘The COVID-19 crisis is unlike anything the world has experienced in recent history and we are adapting to a highly complex and rapidly changing business environment,’ CEO Amin Nasser said in a statement on Sunday.
‘We are seeing a partial recovery in the energy market as countries around the world take steps to ease restrictions and reboot their economies,’ Nasser said. Aramco reported a 73.4 per cent fall in second-quarter net profit, a steeper drop than analysts had forecast, and said it expected capital expenditure for 2020 to be at the lower end of a $25 billion to $30 billion range.
Net profit fell to 24.6 billion riyals ($6.57 billion) for the quarter to June 30 from 92.6 billion riyals a year earlier. ‘Aramco figures are healthy compared to other global peers,’ Mazen al-Sudairi, head of research at Al Rajhi Capital, said. ‘This was the worst quarter in the modern history of the oil industry, and surviving it with healthy figures points to a very positive outlook.’
