Saudi oil giant Aramco announced on Sunday that it recorded a profit of $121 billion in 2023, a slight decrease from its record-breaking $161 billion profit in 2022. The decline was attributed to lower energy prices affecting the company's revenue.
Despite the dip, this still stands as Aramco's second-highest profit ever, showcasing the company's financial strength. The ongoing efforts of the OPEC+ alliance to reduce production in order to stabilize global energy prices have played a role in this scenario.
The company highlighted that the profit decrease was primarily due to lower crude oil prices, reduced sales volumes, and weakening margins in refining and chemicals sectors. Aramco's revenue for the year totaled $440 billion, down from $535 billion in the previous year.
Despite the challenges, Aramco increased its dividends to shareholders, distributing over $31 billion in the fourth quarter of 2023. The company's CEO emphasized their resilience and adaptability in maintaining healthy cash flows and profitability amidst economic challenges.
Aramco's production remained steady at 12.8 million barrels of oil per day, as per the Saudi government's directive, despite initial plans to ramp up output. Saudi Arabia, a key player in the OPEC cartel, has collaborated with other oil-producing nations to limit production and support global oil prices.
With a market value of $2 trillion, Aramco is ranked as the world's fourth most valuable firm, trailing behind tech giants like Apple, Microsoft, and NVIDIA. The company's stock price saw a slight increase, trading at $8.64 per share on the Tadawul stock market.
The kingdom's Crown Prince Mohammed bin Salman aims to diversify Saudi Arabia's economy away from oil dependence through ambitious projects like the futuristic city Neom, valued at $500 billion. However, environmental activists have raised concerns about the environmental impact of continued fossil fuel consumption.
In a recent move, Prince Mohammed transferred an additional 8% of Aramco shares to the country's sovereign wealth fund, worth over $160 billion. The majority of the company remains under the ownership of the Al Saud royal family, with a small portion traded publicly on the Tadawul stock exchange.
