…raises dividend
Saudi Aramco unexpectedly increased its dividend and said it would hike spending as it looks to deploy an avalanche of cash generated by last year’s surge in oil and gas prices.
The world’s biggest energy company made net income for the full year 2022
ar of $161 billion, the most since it listed and up 46% from 2021. Its performance was bolstered by Russia’s invasion of Ukraine roiling oil markets and the OPEC+ alliance raising production.
According to Bloomberg, Aramco boosted its dividend — a crucial source of funding for the Saudi Arabian government — to $19.5 billion for the final quarter, up 4% from the previous three-month period.
US and European peers such as Chevron Corp. and Shell Plc also reported blowout earnings and are returning billions of dollars to shareholders through larger dividends and buybacks. Aramco, until now, has instead focused on using its extra cash to increase output.
Crude prices have fallen from $125 a barrel since the middle of 2022, with Brent dropping another 3.6% this year to below $83 a barrel. That’s been caused in large part by the US Federal Reserve staying hawkish on inflation and investors no longer anticipating interest rates will be on a clear downward path by the second half of 2023.
The company’s adjusted profit weakened to around $31 billion between October and December, according to Bloomberg estimates, down from $42 billion in the third quarter. Aramco will release a full financial statement on Monday.
Sabic, a chemicals firm controlled by Aramco, saw income slump in late 2022 as a global economic slowdown weighed on consumption of everything from plastics to building materials.
China Bounce