Saudi Aramco Almost Triple Profits As Oil Prices Rise

Saudi Aramco, the world’s largest oil company, said on Sunday that its profits for the third quarter had nearly tripled from the period a year earlier, as demand for fuel recovers from the pandemic and prices soar.

Aramco, Saudi Arabia’s national oil company, said net income was $ 30.4 billion for the July-September period, up from $ 11.8 billion a year ago when demand for oil collapsed and prices fell.

The huge profits are largely a reflection of the rapid increases in oil prices. Aramco’s statement did not give full financial details, but it is likely that it received around $ 70 a barrel on average for its oil during the quarter, compared to $ 43.60 a barrel during the quarter. same period in 2020.

Saudi Arabia and other oil-producing countries have sharply cut production in response to falling demand as the pandemic slows driving, air travel and other activities. Now these countries are increasing production, but at a frustratingly slow pace in the eyes of some critics, including the Biden administration.

Aramco said its crude oil production in the third quarter of 2021 averaged 9.5 million barrels per day, a slight increase only to 9.2 million barrels per day during the same period in 2020. .

In a statement, Amin H. Nasser, CEO of Aramco, said he was “optimistic that energy demand will remain healthy for the foreseeable future” despite headwinds such as chain bottlenecks. supply.

As world leaders gather in Glasgow this week for what is described as a crucial United Nations climate summit, Aramco’s results serve as a reminder that the world economy is still addicted to oil. Many forecasters expect demand for oil next year to exceed the pre-pandemic levels of 2019.

While Western oil companies like Royal Dutch Shell and BP are wary of new long-term investments in oil, a few companies, including Aramco and the Abu Dhabi National Oil Company, or ADNOC, are betting there will be a market for them. oil for many years to come.

Aramco said it increased its capital spending by 19% in the quarter to $ 7.6 billion, in part to increase the amount of oil it can produce to 13 million barrels per day from 12 million barrels per day. day.

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Felix J. Dixon

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