Saudi Aramco's second-quarter profit jumped 33% as the Iran war squeezes global oil supply and lifts prices, beating analyst estimates. President Trump has accused U.S. oil majors of profiting from the shortage, while Aramco's CEO says attacks on the company's facilities haven't dented output.
Saudi Aramco reported adjusted net income of 125.2 billion Saudi riyal ($33.4 billion) for the April-to-June period, up 33% year-on-year and above analyst expectations of $31.59 billion. The world's largest oil company said the jump came mainly from higher prices for crude oil and refined and chemical products, a swing tied to the more than five-month-old conflict between the U.S. and Iran.
Trump slams oil majors' profits
The Aramco results land a day after President Trump lashed out at U.S. oil majors Exxon Mobil and Chevron for profiting from the conflict. According to CNBC: "They're making too much money based on a shortage." Exxon's second-quarter profit more than doubled to $14.5 billion compared to a year earlier, while Chevron's earnings soared nearly 400% to $12 billion, up from $2.5 billion in the same period last year.
Aramco downplays attack impact
Aramco disclosed for the first time that its facilities were targeted in July attacks, after oil traders pored over images of apparent tank fires at sites across the kingdom last month. CEO Amin Nasser told analysts on a call that the attacks had no material operational or financial impact, even accounting for the July incidents.
He said full production capacity of 12 million barrels a day remains available and that Aramco could ramp up to that level within three weeks if the government asked. Houthi threats to block Saudi shipments through the Red Sea haven't hit export volumes either, Nasser added.
Supply shock deepens
Nasser said the war has cost the world more than 2.6 billion barrels of oil destined for industries such as agriculture, semiconductors and manufacturing. Aramco's 1,200-kilometer East-West pipeline to the Red Sea, which bypasses the Strait of Hormuz, has held the net loss to about 1.8 billion barrels by keeping exports at a maximum 7 million barrels a day. Even if the strait reopened today, Nasser warned it would take up to 18 months at 2.1 million barrels a day to rebuild depleted inventories.
The company's board approved a second-quarter base dividend of $21.9 billion, payable over the next three months. Its gearing ratio rose to 6.2% at the end of June from 4.8% at the end of the first quarter.
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