Oil giant Aramco reports profit decline due to falling oil prices.
Saudi Aramco's profit decline due to falling oil prices
The world's largest oil company, Saudi Aramco, has experienced a decline in net profit in the first quarter due to falling oil prices. This creates additional pressure on the finances of the oil exporter. The company's net profit decreased by 4.6% to 97.5 billion riyals (26 billion dollars) for the quarter, Saudi Aramco reported.
Operating profit fell by 5.3%, but exceeded analysts' expectations. The company's dividends have also decreased, and amid this pressure is increasing on Aramco's financial balance. The decline in oil prices could harm not only the company itself but also the Saudi government.
As a result of the dividend cuts, pressure on the Saudi budget is only increasing. Even efforts aimed at modernizing the economy, spearheaded by Crown Prince Mohammed bin Salman, are leading to an increase in the kingdom's deficit and debt levels. Brent crude contracts are trading at low levels, complicating Saudi Arabia's financial situation.
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