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Saudi Aramco’s profits soar on higher prices and refining margins | Business Section

DUBAI (Reuters) — State-owned oil giant Saudi Aramco on Sunday reported its highest quarterly profit since the company went public in 2019, boosted by rising oil prices and refining margins.

Aramco joins oil majors such as Exxon Mobil Corp and BP which reported strong or record results in recent weeks after Western sanctions against the main Russian exporter squeezed an already undersupplied global market, sending oil prices soaring. crude and natural gas.

The company expects “oil demand to continue to grow for the remainder of the decade despite downward economic pressures on near-term global forecasts,” CEO Amin Nasser said in the earnings report. from Aramco.

Net profit rose 90% to 181.64 billion riyals ($48.39 billion) for the quarter to June 30, from 95.47 billion riyals a year earlier and from an average estimate of 15 $46.2 billion analysts.

It declared a dividend of $18.8 billion in the second quarter, in line with its own target, to be paid in the third quarter.

Shares of Aramco, which were little changed on Sunday, are up more than 25% this year.

Nasser, speaking to reporters on an earnings call, said he was concerned about the lack of global hydrocarbon investment that has led to “very limited” spare capacity. He said Aramco was ready to increase oil production to its maximum sustained capacity of 12 million barrels per day if requested by the Saudi government.

Aramco said its average total hydrocarbon production was 13.6 million barrels of oil equivalent per day in the second quarter. The company is working to increase production from multiple energy sources, including renewables and blue hydrogen as well as oil and gas, as it works on both energy security and energy targets. climate, said Nasser.

Capital expenditure rose 25% to $9.4 billion in the quarter compared to the same period in 2021. Aramco said it continued to invest in growth, expanding its chemicals business and by developing prospects in low-carbon businesses.

She is also currently exploring opportunities in the liquids-to-chemicals industry with a focus on the Asian market.

In July, Exxon posted its biggest quarterly profit on record, a net profit of $17.9 billion, nearly four times higher than a year earlier, while European majors Shell and TotalEnergies also benefited from higher margins for the manufacture of fuels such as gasoline and diesel.

The Saudi stock market, up 11% this year, holds great promise for company listings in the near future, Nasser said, adding that there are “certain expectations” that Aramco may list certain entities within of the company.

Aramco is working to merge two energy trading units, with Aramco Trading Co to take over Motiva Trading, ahead of a possible initial public offering of the business, sources said.