Saudi Arabia’s state-owned oil company Aramco paid out nearly $100bn (£77bn) in dividends, even though the company’s annual profits fell from the record profits it collected the previous year.
The group, which is 82% owned by the Saudi government, said in its annual results that dividends to shareholders rose 30% to $97.8 billion in 2023.
Overall profit fell by just under 25% to $121.3 billion due to lower oil prices and lower sales compared to the previous 12 months.
Despite the decline, the profit figure was the second-highest after Saudi Aramco’s reported $161.1 billion in 2022, and the largest profit ever recorded by an oil and gas company. The strong performance in 2022 was primarily due to higher oil prices as a result of Russia’s full-scale invasion of Ukraine in early 2022, which affected global supplies.
Brent crude oil prices, a benchmark for oil prices, have fallen from a high of nearly $120 per barrel in mid-2022 to a low of $67 per barrel last year. Oil prices are trading at around $82 a barrel, despite concerns that tensions in the Middle East could push oil prices above $100 a barrel.
The dividend payments are likely to anger campaigners who have criticized energy companies’ huge profits and bonuses handed out to their executives since commodity prices soared amid a household cost-of-living crisis. expensive. On Friday, BP’s new boss’s £8m salary was branded “sickening”.
Aramco’s huge dividend is expected to be mirrored by other major oil companies around the world. A report released in January by the Institute for Energy Economics and Financial Analysis (IEEFA) found that five other major oil companies – BP, Shell, Chevron, ExxonMobil and Total Energies – will pay dividends in 2023. , predicts that amount will exceed last year’s $104 billion.
Aramco announced that its base dividend for the fourth quarter of 2023 will increase by 4% year-on-year to $20.3 billion, and the performance-based dividend will increase by 9% to $43.1 billion.
The company’s capital expenditures in 2023 were $49.7 billion, up from $38.8 billion in 2022. It also expects this investment to reach $48 billion to $58 billion this year and grow further by mid-2020, with some of this investment expected to be in non-oil projects.
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Amin H. Nasser, President and Chief Executive Officer of Aramco, said: “As we aim to create and capture added value from our operations, our capital expenditures will increase in line with our guidelines and move towards a future where we believe oil and gas will lead to oil and gas development. Along with new energy solutions, it will be an important part of the global energy mix for decades to come. ”
Almaco announced it would supply 12 million barrels per day after the Saudi government ordered it to scrap plans to increase production to 13 million barrels per day in January.
