DUBAI, United Arab Emirates (AP) — Saudi Arabia’s oil-producing company, Aramco, announced Sunday a net income of around $47 billion for the first half of the year, double what it earned over the same period last year when the coronavirus grounded travel and pummeled global demand for oil.
This puts Aramco back squarely where it was before the pandemic struck and sunk earnings to $23.3 billion in the first six months of 2020.
Aramco CEO Amin Nasser said the company’s second quarter results “reflect a strong rebound in worldwide energy demand.”
“While there is still some uncertainty around the challenges posed by COVID-19 variants, we have shown that we can adapt swiftly and effectively to changing market conditions,” he said.
The company also confirmed in its earnings report that its performance in the second quarter of 2021 “was primarily driven by higher crude oil prices.” Benchmark Brent crude oil traded just over $70 a barrel Friday, up from the $45 a barrel range it hovered at this time last year.
The majority state-owned oil company said net income for the second quarter was $25.46 billion compared to the dramatic figure of just $6.6 billion last year. This quarter’s figure is slightly higher than the $24.7 billion it earned in the second quarter of 2019, before the coronavirus.
Its second quarter earnings are also an improvement from the first quarter of the year, which raked in $21.7 billion.
Saudi Arabia has led global efforts by major oil producers to curb output in order to keep prices from crashing as coronavirus uncertainty impacts consumer demand for crude. Under the agreement, the kingdom has been producing between 8-9 million barrels per day since May 2020.
Aramco’s financial health is crucial to Saudi Arabia’s stability. Despite massive efforts by Saudi Crown Prince Mohammed bin Salman to diversify the economy, the kingdom still depends heavily on oil exports to fuel government spending.
The company said it will uphold its commitment to pay out dividends of $18.75 billion for the second quarter as part of its promise to pay $75 billion in annual dividends. Most of that payout is to the company’s primary shareholder, the Saudi government.
Its operating cash flows and cash proceeds were buoyed when it signed a $12.4 billion pipeline deal with a consortium led by a U.S.-based group, as well as a $6 billion Shariah-compliant bond issuance.