Emblem of Aramco, formally the Saudi Arabian Oil Group, Saudi petroleum and pure gasoline firm, seen on the second day of the twenty fourth World Petroleum Congress on the Huge 4 Constructing at Stampede Park, on September 18, 2023, in Calgary, Canada.
Artur Widak | Nurphoto | Getty Photographs
Saudi Aramco on Tuesday posted a drop in second-quarter revenues, citing decrease crude oil and refined chemical merchandise costs that have been solely partially offset by increased traded volumes.
The world’s largest oil firm declared an adjusted web revenue of 92.04 billion Saudi riyal ($24.5 billion) over the three months to the tip of June. The end result compares with a forecast of adjusted web revenue of $23.7 billion, in line with an analyst survey estimate equipped by the corporate.
Second-quarter revenues dropped to 378.83 billion Saudi riyals from 425.71 billion Saudi riyal in the identical interval of the earlier yr. The outcomes marked ten quarters in a row of declining income.
“Market fundamentals stay sturdy and we anticipate oil demand within the second half of 2025 to be greater than two million barrels per day increased than the primary half,” Aramco CEO Amin Nasser stated in a Tuesday assertion accompanying the outcomes.
Capital expenditure picked up barely to 46.2 billion Saudi riyal within the June quarter, up from 45.5 billion Saudi riyal in the identical interval a yr prior.
In a name with journalists, Nasser outlined plans for additional elevated capital expenditure regardless of the autumn in revenues.
“We at all times take a look at potential to enhance effectivity in our spending constructing and suppleness and self-discipline, and that is embedded in our planning and capital self-discipline,” the CEO stated. “We’ll proceed to watch market situations, however we preserve our steering for the yr 2025, of $52 to $58 billion.”
Some analysts see this steering as overly optimistic.
“An in-line set of outcomes this morning from Aramco, with sequentially weaker upstream earnings offset by a restoration in refining outcomes,” RBC analysts stated in a observe following the outcomes. “With $25.5bn of capital investments within the first half of 2025, Aramco seems to be working decrease than its steering of $52-58bn for the complete yr. Whereas spending sometimes picks up within the second half of the yr, we expect full yr capex may are available in in the direction of the decrease finish of its guided vary, topic to acquisitions.”
Crude costs have stayed depressed over the course of the yr, barring a quick second-quarter flare-up sparked by Israel-Iran tensions. Futures have been below strain from an unsure outlook for demand, exacerbated since April by the rollout of Washington’s wide-spanning tariffs. The protectionist commerce measures muddy the image for progress on the planet’s largest economic system and the way forward for the U.S. greenback, which denominates most commodities — together with crude oil.
Aramco CFO Ziad Al-Murshed, additionally talking on the press name, harassed the corporate’s efforts to decrease prices.
“Throughout our upstream and throughout our downstream, we’re going by way of transformations that aren’t solely targeted on value slicing, however value slicing is the foremost part of it,” Al-Murshed stated. “So each asset that we now have throughout our upstream portfolio and each asset that we now have throughout our downstream portfolio has been present process for the previous couple of years, these transformational initiatives, and a variety of it’s targeted on slicing prices.”
Aramco’s revenue is ready to see a lift from increased output, after Saudi Arabia – and 7 different OPEC and non-OPEC companions — full unwinding 2.2 million barrels per day of voluntary cuts by way of a final tranche in September. Saudi Arabia most not too long ago produced 9.356 million barrels per day in June, in line with impartial analyst estimates compiled in OPEC’s Month-to-month Oil Market Report.
Requested concerning the OPEC+ actions, Nasser stated, “I am not going to touch upon OPEC’s coverage, however the influence on Saudi Aramco, should you take a look at as much as September, you see 1 million barrels of the expansion in our manufacturing on account of that.”
The corporate can also be focusing closely on its gasoline manufacturing, aiming for a greater than 60% improve by 2030 in comparison with baseline 2021 ranges. The event of Saudi Arabia’s Jafurah gasoline subject is predicted to be a significant a part of that.
That 60% improve purpose “is on observe as a result of it’s going to give us a variety of alternative to maximise manufacturing of our gasoline sources the dominion, and we now have a lock-in demand right here within the kingdom for this extra gasoline that we’re making extra upstream, along with availing placement for our price to our liquid chemical funding,” Nasser stated. Gasoline demand is predicted to select up considerably in 2026, in line with the Worldwide Power Company.
“So we’re capturing a variety of alternatives, and a variety of alternatives develop into significantly better in a down cycle,” the CEO stated.
Aramco has more and more tapped debt markets, with two issuances totalling $9 billion within the second half of 2024 and a three-part bond sale of $5 billion this yr. The corporate’s gearing ratio went as much as 6.5% as of June 30, 2025, in comparison with 5.3% as at March 31, 2025.
Entrance of thoughts for traders is the dividend coverage at Aramco, which in March slashed investor returns for 2025 to $85.4 billion — down sharply from the $124.2 billion of 2024 — after a first-quarter decline in web income. Aramco declared a base dividend of $21.1 billion and a performance-linked dividend of $0.2 billion within the third quarter.
The corporate’s dividend yield stood at 5.5% as of Monday, nonetheless forward of U.S. business peer Exxon Mobil‘s 3.6% and Chevron‘s 4.5%, in line with FactSet information.
Aramco’s payouts ripple sharply into the funds of Saudi Arabia, which has been juggling diversifying its economic system away from oil reliance below Crown Prince Mohammed bin Salman’s signature Imaginative and prescient 2030 program. Saudi Arabia’s gross home product expanded by 3.9% within the second quarter, boosted by non-oil actions.
