Saudi Aramco Reports 25% Rise in Q1 Profit Amid Global Oil Supply Concerns

Saudi energy giant Saudi Aramco recorded a sharp rise in first-quarter earnings, underscoring the company’s ability to withstand mounting geopolitical tensions in the Middle East and disruptions to global oil shipments. The world’s largest oil exporter announced a 25 percent increase in net profit for the quarter ending March 31, reporting earnings of $32.5 billion, ahead of analysts’ expectations of $30.95 billion. The strong performance was driven by higher crude oil prices and increased sales volumes across its oil, refining, and chemical businesses. Aramco also revealed that its total revenue climbed nearly seven percent year-on-year to $115.49 billion, reflecting stronger global demand and elevated energy prices during a period of heightened uncertainty in international markets. The company’s impressive results come as tensions linked to the U.S.-Iran conflict continue to affect oil transportation routes, particularly through the strategic Strait of Hormuz — a key maritime corridor that previously handled about one-fifth of global oil supply before the crisis intensified. To maintain steady exports and minimize supply disruptions, Aramco increased the use of its East-West crude pipeline, which transports oil from Saudi Arabia’s eastern region to the Red Sea port of Yanbu on the west coast. Chief Executive Officer Amin Nasser described the pipeline as essential during the ongoing supply crisis. “Our East-West Pipeline, which reached its maximum capacity of 7.0 million barrels of oil per day, has proven itself to be a critical supply artery, helping to mitigate the impact of a global energy shock,” Nasser said. He further stressed the importance of stability in global energy markets, adding: “Reliable energy supply is critical.” According to the company, the pipeline can transport about two million barrels per day to refineries located on Saudi Arabia’s west coast, while the remaining five million barrels are directed toward exports. The regional conflict and Iran’s blockade of shipping routes through Hormuz forced Saudi Arabia to reduce oil production by approximately two million barrels per day during the period. Reports indicate that the East-West pipeline primarily transported Arab Light crude and limited quantities of Arab Extra Light, while heavier grades experienced reduced movement. Aramco’s adjusted quarterly net profit stood at $33.6 billion after excluding non-operational accounting items worth $1.06 billion, also surpassing analysts’ projections. Meanwhile, the company slightly reduced capital expenditure to $12.1 billion during the quarter, compared to $12.5 billion recorded a year earlier and $13.4 billion in the previous quarter. Despite the reduction, Aramco maintained its projected annual capital expenditure target of between $50 billion and $55 billion for 2026. The oil giant also announced a higher shareholder payout for the first quarter, declaring a base dividend of $21.9 billion — a 3.5 percent increase from the same period last year. The dividend is scheduled for payment in the second quarter and aligns with the company’s anticipated total dividend payout of $87.6 billion for 2026. Aramco previously introduced a performance-linked dividend structure tied to free cash flow in 2023, further strengthening returns to investors. The Saudi government remains heavily dependent on Aramco’s earnings and dividends to finance domestic projects and bridge fiscal deficits. The state currently owns about 81.5 percent of the company, while the Public Investment Fund controls an additional 16 percent stake. Despite the strong profit figures, Aramco’s free cash flow dipped slightly to $18.6 billion from $19.2 billion recorded in the corresponding period last year, partly due to a significant rise in working capital requirements. The company’s gearing ratio, which measures debt relative to equity, also increased to 4.8 percent at the end of March from 3.8 percent at the close of 2025.