Saudi Aramco expects lower dividends in 2025 as profit falls

Saudi Aramco, the world's top oil-exporting company, expects to distribute about $85 billion in dividends this year, compared to $124 billion payout last year, as full-year profit fell 12 per cent.

The company’s full-year profit dropped to $106.25 billion, from $121.27 billion in 2023, on lower oil and gas prices, Aramco said on Tuesday in a filing to the Tadawul stock exchange, where its shares are traded.

Aramco's revenue dipped nearly 1 per cent during the same period to $436.61 billion.

Brent, the benchmark for two thirds of the world’s oil, ended last year lower as rising US interest rates and sluggish Chinese crude consumption weighed on demand in the second half of the year.

Aramco said it would distribute $21.36 billion in dividends for the fourth quarter, including a smaller performance dividend of $220 million.

For the Saudi government, the largest shareholder in Aramco, these dividends serve as a crucial source of revenue, helping fund the national budget and economic diversification efforts.

“Global oil demand reached new highs in 2024, and we expect further growth in 2025. With dependable and more sustainable energy key to global economic growth, we continue to make progress on projects to maintain our maximum sustainable crude oil capacity,” said Amin Nasser, Aramco’s chief executive.

This year, Aramco has projected capital expenditures between $52 billion and $58 billion, with an additional $4 billion in project financing. Last year’s capital investment totalled $53.3 billion, of which, $50.4 billion was organic capital expenditure.

The company said its planned growth in both upstream and downstream sectors is "on track".

By 2030, Aramco expects to boost its operating cash flow by $9 billion-$10 billion through higher gas production and $8 billion-$10 billion through downstream expansion.

The company has been pouring billions of dollars into the massive Jafurah unconventional gas project, east of Ghawar in Saudi Arabia's eastern province, to support the kingdom's efforts to curb liquid burning for power generation.

Aramco is also actively pursuing opportunities in the global LNG market, including investing in LNG projects and securing offtake agreements.

The company said that its spare production capacity allows it to flexibly meet potential oil demand growth, and utilising 1 million barrels per day (bpd), based on last year's average price, could generate an additional $12 billion in operating cash flow.

Aramco's average realised crude oil price – the price at which it sold its crude – fell to $80.2 per barrel last year, from $83.6 per barrel in 2023.

Oil prices have been volatile since the beginning of this year due to tighter US sanctions on oil flows from Russia and Iran, coupled with discussions of tariffs on energy imports and concerns of an all-out trade war, which could weigh on demand growth.

Aramco said its cash flow from operating activities stood at $135.7 billion last year, compared with $143.4 billion the year before.

The company's results come after Opec+ reaffirmed its plan to start returning some supply to the market next month.

The producer alliance will proceed with a "gradual and flexible" return of 2.2 million bpd of voluntary cuts, starting April 1, and this increase may be paused or reversed depending on market conditions, Opec+ said on Monday.