Saudi Aramco reported a 25 per cent jump in first-quarter profit on Sunday, showing its resilience as US-Iran war tensions curtail Strait of Hormuz shipping, with the state oil giant's East-West crude pipeline running at full capacity to mitigate the impact to supplies.
The world's top oil exporter earned a net profit of $32.5 billion in the three months ended March 31, beating an LSEG consensus estimate of $30.95 billion.
Total revenue surged nearly seven per cent from a year earlier to $115.49 billion due to higher prices and volumes sold of both crude oil and refined and chemical products.
Iran's blockade of shipping through the crucial Hormuz waterway amid the US-Israeli conflict - which has curtailed energy supply and sent prices surging - prompted Aramco to ramp up crude flows from its east coast to the Red Sea port of Yanbu.
"Our East-West Pipeline, which reached its maximum capacity of 7.0 million barrels of oil per day, has proven itself to be a critical supply artery, helping to mitigate the impact of a global energy shock," Aramco CEO Amin Nasser said, adding that, "reliable energy supply is critical."
The pipeline can supply about two million bpd to refineries on Saudi Arabia’s west coast, leaving five million bpd for export.
During the war, Saudi Arabia cut output by two million bpd after Iran blockaded Hormuz, a waterway that carried a fifth of world oil supply before the war. The line mainly carries Arab Light and some Arab Extra Light, with heavier grades curtailed.
Aramco's adjusted quarterly net profit was $33.6 billion, beating a company-provided median analyst estimate of $31.16 billion. The figure strips out $1.06 billion in non-operational accounting items.
Capital expenditure fell slightly to $12.1 billion in the quarter from $12.5 billion a year prior, and was sharply down from $13.4 billion in the fourth quarter. Aramco had outlined $50-55 billion in capital expenditure this year.
Aramco declared a first-quarter base dividend of $21.9 billion, up 3.5 per cent year-on-year and payable in the second quarter, in line with expected total dividends of $87.6 billion for 2026.
It had also introduced a performance-linked dividend in 2023 linked to free cash flow.
The Saudi state relies heavily on Aramco’s payouts to fund domestic spending and cover budget gaps. The government directly owns almost 81.5 per cent of the company, while the Public Investment Fund holds 16 per cent.
Free cash flow slipped to $18.6 billion from $19.2 billion a year earlier, impacted by a $15.8 billion rise in working capital. Aramco’s gearing - measuring its debt compared to equity - rose to 4.8 per cent at March 31 from 3.8 per cent at the end of 2025.
(Reporting by Yousef Saba; Editing by Kim Coghill and Bernadette Baum)
