Key information
- Aramco's net income decreased 15.3 percent to $27.6 billion in the third quarter of 2024.
- Revenue for the quarter fell to $103.3 billion from $122.1 billion in Q3 2023.
- The company partially mitigated losses through reduced expenses and gains from derivative instruments.
Aramco's net income saw a decline of approximately 15.3 percent during the third quarter of 2024, reaching $27.6 billion. This figure is lower than the $32.6 billion recorded during the same period last year. Revenue for the quarter also declined to $103.3 billion from $122.1 billion in the third quarter of 2023.
Factors Contributing to Profit Reduction
The company attributed the decline in profits primarily to reduced crude oil prices and narrowing refining margins. However, Aramco partially mitigated these losses through reductions in selling, administrative and general expenses. This reduction was obtained thanks to the gains made on derivative instruments and the reduction in production royalties. These royalty reductions are a result of lower average crude oil prices and a lower effective royalty rate than the previous year.
CEO Perspectives and Strategy
Aramco Chairman and CEO Amin H. Nasser highlighted the company's strong free cash flow generation during the quarter despite challenging market conditions. He highlighted the ongoing progress in upstream development projects, downstream value chain improvement and advancements under their new energy program. Mr. Nasser expressed confidence that by strategically pursuing growth opportunities, effectively integrating operations and diversifying, Aramco will maintain positive momentum and consolidate its position as a leading global player in the fields of energy and petrochemicals.
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