Saudi Aramco announced a 19% drop in quarterly profits when compared with the same period in 2022. This marks the first year-on-year decline for the company’s profits since 2020.

Saudi Aramco, which is primarily owned by the Saudi Arabian government, recorded a profit of $31.9bn in the first quarter of 2023, compared with $39.5bn for the same period last year.

Other oil majors have recorded record profits for the first quarter, including BP, which made a profit of $8.2bn. This is a significant improvement on the $20.4bn loss sustained by the company in the first quarter of 2022.

Shell also recorded record profits of almost $9.7bn for the same period and Equinor posted $12bn in first quarter profits. Despite a reduction when compared to this time last year, Saudi Aramco’s profits remain significantly than other oil companies, tripling ExxonMobil’s profits of $11.2bn.

The company maintained a quarterly dividend of $19.5bn paid in the first quarter, representing a 4.0% increase from the previous quarter.

According to Amin H. Nasser, CEO of Saudi Aramco, the results “Reinforce [the company’s] commitment to maximise long-term shareholder value.” Nasser added: “We are also announcing our intention to introduce a mechanism for performance-linked dividends in addition to the base dividend the company currently distributes”.

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The company announced that it would pay its first-quarter dividend of $19.5bn in the second quarter.

Saudi Aramco pumped the equivalent of 12.8 million barrels of oil a day in the first quarter of 2023, down from 13 million barrels a day in the same period of 2022.

Falling global oil prices

Oil prices have fallen globally, with Brent Crude down 25% across the course of the year amid measures from Europe and the US to reduce inflation.

Last year Aramco recorded a record annual profit of $161.1bn. While oil and gas makes up a majority of the business, the company claims that it is expanding its renewables.

According to Nasser, the company plans “to continue to be a reliable energy supplier with the ability to provide more sustainable energy solutions, supporting efforts to achieve an orderly energy transition”.

Aramco plans to invest in 12GW of solar photovoltaic and wind capacity by 2035. Other energy giants have committed to much higher targets, including TotalEnergies, which seeks to install 35GW of renewable energy capacity by 2025 and 100GW by 2030.