World Saudi Aramco Q1 profits jump 30% on oil market recovery
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Energy giant Saudi Aramco on Tuesday posted a 30 percent jump in first quarter profits, in a sign of recovery from last year's oil market crash fuelled by the coronavirus pandemic.
Aramco said its net profit rose to $21.7 billion in the first three months of the year, compared to $16.7 billion in the same quarter of 2020, owing to a stronger oil market and higher refining and chemicals margins.
The bumper results follow strong profits posted last month by major oil firms -- including France's Total, Britain's BP and Anglo-Dutch group Shell -- as a recovery in crude prices fuelled their rebound from the pandemic.
'Marriage of convenience': A fragile Saudi, Russian oil alliance
Russia and OPEC leader Saudi Arabia have made a fragile oil alliance work during the pandemic, but their marriage of convenience could be undone as a rebounding market dredges up old tensions, analysts said. Though a fragile truce has since returned to the alliance, Alexey Gromov, in charge of energy at the Institute for Energy and Finance in Moscow, said Saudi Arabia and Russia now "occupy almost identical positions within OPEC+, which can periodically lead to misunderstandings or to a certain tension.
"The momentum provided by the global economic recovery has strengthened energy markets," Aramco chief executive Amin Nasser said in a statement.
"Aramco's operational flexibility, financial agility and the resilience of our employees have contributed to a strong first quarter performance."
The strong earnings provide relief to Aramco, Saudi Arabia's cash cow, which has revealed consecutive falls in profits since it began disclosing earnings in 2019.
The company's low earnings piled pressure on government finances as Riyadh faces a ballooning budget deficit and pursues multi-billion dollar projects to diversify its oil-reliant economy.
Saudi Arabia is currently seeking to monetise its energy assets, as it explores new revenue streams to fund its ambitious diversification drive.
As Saudi prince rises, Bin Laden business empire declines
Saudi Arabia's uber-wealthy Bin Laden family survived the fallout from the September 11, 2001 attacks in the US, but their fortunes nose-dived with the meteoric ascent of Crown Prince Mohammed bin Salman. A decade after the killing of 9/11 mastermind Osama bin Laden, disowned and labelled the "black sheep" of the family, the construction empire founded by his father is saddled with crushing debt. The state has taken management control of the Bin Laden Group, Saudi Arabia's biggest construction company and branded by some as the kingdom's Rockefellers for their vast infrastructure projects, after they were snared in an anti-corruption purge widely seen as a sha
Last month, Aramco said it had struck a $12.4-billion deal to sell a minority stake in a newly formed oil pipeline business to a consortium led by US-based EIG Global Energy Partners.
Long seen as the kingdom's "crown jewel", Aramco and its assets were once tightly government-controlled and considered off-limits to outside investment.
But with the rise of Crown Prince Mohammed bin Salman, Saudi Arabia's de facto ruler, who is accelerating efforts to implement his "Vision 2030" reform programme, the kingdom has shown readiness to cede some control.
In late April, Prince Mohammed said Saudi Arabia, the world's top crude exporter, was in talks to sell one percent of Aramco to an unnamed foreign energy firm.
Aramco previously sold a sliver of its shares on the Saudi bourse in December 2019, generating $29.4 billion in the world's biggest initial public offering.
The energy giant could announce another offering of shares to international investors within the next year or two, the prince said.
In a major new diversification push in March, Saudi Arabia announced plans to pump investments worth $3.2 trillion into the national economy by 2030, roping in the kingdom's biggest companies including Aramco.
Under a programme named "Shareek", or partner, Aramco and other top Saudi companies will lead the investment drive by contributing five trillion riyals ($1.3 trillion) over the next decade, Prince Mohammed said.
Saudi Arabia-Pakistan agree to mend strained ties .
Announcement comes after Pakistani PM Imran Khan held talks with Crown Prince Mohammed Bin Salman.On his seventh visit to the wealthy kingdom since his 2018 election, Pakistani Prime Minister Imran Khan was given a warm welcome by Saudi officials in the western coastal city of Jeddah.