Aramco, the world’s largest oil company based in Saudi Arabia, declared a record annual net profit of $161.1 billion for 2022 on Sunday. This is a rise of 46% from the previous year due to higher energy prices, bigger sales volumes, and improved margins for refined goods.
A brief about Saudi Arabia oil company Aramco becomes the latest energy firm to post record profits
The gains come after comparable reports from worldwide competitors BP, Shell, Exxon Mobil, and Chevron in February, most of which reported record profits for the previous year.
Oil prices fluctuated significantly in 2022, rising on geopolitical concerns throughout the conflict in Ukraine and falling on decreased demand from China, the world’s major importer, and concerns about a slowdown in the economy.
“Given that we think oil and gas will remain crucial for the foreseeable future, the risks of underinvestment in our industry are significant – including contributing to higher energy prices,” Amin Nasser, chief executive of Aramco, said in the results announcement.
The company is investing in new, lower-carbon technologies with the potential to further reduce emissions in order to solve those issues, Nasser added, in addition to increasing production of oil, gas, and chemicals.
Aramco reported that it estimates its capital expenditures this year to be between $45.0 billion and $55.0 billion, including overseas investments, up 18% from the $37.6 billion they were in 2022.
For the fourth quarter, Aramco declared a dividend of $19.5 billion, an increase of 4% over the third quarter.
A bonus share plan was also suggested by the company’s board, with qualified shareholders receiving one share for every ten shares they own.
In contrast to the $107.5 billion in 2021, free cash flow hit a record high of $148.5 billion in 2022.