Saudi oil giant Aramco announced a 25% drop in first quarter net profit on Tuesday due to falling oil prices, saying the coronavirus crisis will dampen demand and profits year-round.
Aramco posted net profit of 62.5 billion riyals ($ 16.66 billion) in the first three months of 2020, up from $ 22.2 billion in the first quarter of last year, the most said. large company listed on the stock market in the world.
"The Covid-19 crisis is unlike anything the world has experienced in recent history and we are adapting to a very complex and rapidly changing business environment," Aramco CEO said in a statement. Amin Nasser.
According to the company, the drop in profits mainly reflects the sharp drop in crude oil prices, as well as the decline in refining and chemical margins.
"For the rest of 2020, we expect the impact of the Covid-19 pandemic on global energy demand and oil prices to weigh on our revenues," added Nasser.
The slowdown in economic activity due to the coronavirus pandemic has caused a cataclysm in the world oil market, also struck by a price war between Saudi Arabia and Russia, the world's third and second largest producers respectively.
As a result, the price of oil plummeted in March to its lowest level in nearly two decades, losing almost two-thirds of its value.
"In the longer term, we remain confident that the demand for energy will rebound as the world economies recover", wanted to reassure Mr. Nasser, adding however that the company plans to continue its spending cuts investment.
It is not the first time that Aramco has suffered the blow in the face of a fall in crude oil prices on world markets. The juggernaut recorded a 20.6% drop in its net profit in 2019, to $ 88.2 billion. In 2018, the company posted net earnings of $ 111.1 billion.
The world's largest exporter of crude oil, Saudi Arabia announced on Monday an austerity plan providing for a tripling of value added tax and the end of monthly allowances to its citizens, in response to the fall in oil prices and the Covid-19 pandemic.
The same day, the Ministry of Energy said it had asked Aramco to reduce its production by one million barrels per day from June, in order to support oil prices.
© 2020 AFP