Saudi Aramco's third-quarter adjusted net income rose 9% to $31.2 billion, beating analyst estimates, as the Iran war pushed oil prices higher. Production fell about 10%, and Houthi attacks have recently targeted the company's infrastructure.
Saudi Aramco posted a 9% increase in third-quarter profit after earnings from its refineries jumped and the Iran war drove oil prices higher. Adjusted net income reached $31.2 billion, up from $28.6 billion a year earlier, according to the company's statement.
Refining earnings and higher prices lift results
The result beat analysts' estimates of $28.7 billion compiled by Bloomberg. Aramco also kept its base dividend at $21.9 billion on a quarter-on-quarter basis, a payout that is key for Saudi Arabia's public finances.
Aramco sold its oil at about $95.20 a barrel in the quarter, compared with $70.10 a year earlier. Earnings before interest and tax for its downstream businesses, which include refineries and trading, jumped more than three-fold to a record of over $10 billion.
Brent crude in London surged more than 40% during the quarter to average over $90 a barrel, as Iranian attacks on shipping in the Strait of Hormuz raised supply concerns.
Output drops as attacks hit infrastructure
Volumes moved the other way. Total liquids production dropped about 10% to 8.7 million barrels a day, while natural gas output dipped 2.6%.
Houthi attacks in recent weeks have targeted Aramco's energy infrastructure, including Yanbu, refineries in western Saudi Arabia, a major oil field and even the company's headquarters. Aramco raised crude shipments from Ras Tanura in September and routed them through Hormuz after attacks on the East-West pipeline disrupted the Red Sea alternative.
The balance sheet strengthened. Gearing eased to 5.5% at the end of September, from 6.2% at the end of June, and $28.2 billion of free cash flow covered the dividend payout.
Brent climbs again after new US strikes
Oil kept moving on the day of the results. The Guardian reported that Brent climbed $2.38 to $107.15 a barrel, a 2.2% gain, after the US reportedly launched limited strikes on Iran's Qeshm Island late on Monday. Before the war began on 28 February, Brent traded around $72 a barrel.
Sources: Rigzone (Bloomberg), The Guardian
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