Aramco Records Strong First-Quarter Earnings
Saudi oil giant Saudi Aramco posted a 25 per cent increase in first-quarter profit as tensions involving Iran, the United States, and Israel disrupted global energy markets.
The company announced on Sunday that net profit rose to $32.5 billion for the quarter ending March 31. The figure surpassed analysts’ expectations of $30.95 billion.
Revenue also climbed by nearly seven per cent year-on-year to $115.49 billion. Higher crude prices and stronger sales of refined and chemical products drove the increase.
Hormuz Tensions Push Pipeline Operations to Maximum Capacity
The ongoing conflict in the Middle East has disrupted shipping activities around the Strait of Hormuz, one of the world’s most important oil routes.
As a result, Aramco increased crude transportation through its East-West Pipeline, which links Saudi Arabia’s eastern oil fields to the Red Sea port of Yanbu.
Aramco Chief Executive, Amin Nasser, said the pipeline operated at its full capacity of seven million barrels per day during the crisis.
“Our East-West Pipeline has proven itself to be a critical supply artery, helping to reduce the impact of the global energy shock,” he said.
The pipeline currently supplies around two million barrels daily to refineries on Saudi Arabia’s west coast, while the remaining five million barrels support exports.
Oil Supply Disruptions Intensify Global Concerns
Iran’s blockade of the Strait of Hormuz has heightened fears over global energy supplies. Before the crisis, the route handled nearly 20 per cent of global oil shipments.
During the conflict, Saudi Arabia reportedly reduced output by two million barrels per day as shipping risks increased across the region.
In addition, Aramco focused mainly on transporting Arab Light and Arab Extra Light crude grades through the pipeline.
Dividend Payments Remain Strong
Despite rising geopolitical risks, Aramco maintained strong shareholder payouts.
The company declared a first-quarter base dividend of $21.9 billion, representing a 3.5 per cent increase compared to the same period last year.
The payout aligns with Aramco’s projected total dividend distribution of $87.6 billion for 2026.
Saudi Arabia depends heavily on Aramco’s dividends to support public spending and close budget gaps. The Saudi government owns over 81 per cent of the company, while the Public Investment Fund controls another 16 per cent stake.
Capital Spending Declines Slightly
Aramco’s capital expenditure dropped slightly to $12.1 billion during the quarter from $12.5 billion recorded a year earlier.
The figure also fell below the $13.4 billion spent in the final quarter of 2025.
However, the company maintained its full-year capital spending target between $50 billion and $55 billion.
Free cash flow slipped to $18.6 billion due to higher working capital requirements, while the company’s gearing ratio rose from 3.8 per cent to 4.8 per cent.
Trump Accuses Iran of Escalating Crisis
Meanwhile, Donald Trump accused Iran of provoking global instability during the conflict.
In a statement posted on Truth Social, Trump said Iran had “been playing games with the United States and the rest of the world for 47 years.”
He also warned that Tehran “would be laughing no longer.”
Trump insisted the ceasefire remained active despite continued military actions and naval tensions in the region.
Iran Rejects Claims of Weakness
Iranian President Masoud Pezeshkian dismissed suggestions that the country would surrender under pressure.
“We will never bow our heads before the enemy,” he said in a statement shared on X.
Iran’s Deputy Foreign Minister for Legal and International Affairs, Kazem Gharibabadi, also criticised the growing military presence near the Strait of Hormuz.
He argued that foreign naval deployments would only escalate tensions further.
Rising Fuel Prices Hit Consumers
The crisis has continued to affect global fuel prices, especially in the United States.
According to the American Automobile Association, average petrol prices climbed to $4.52 per gallon, compared to $3.14 during the same period last year.
Analysts warn that prolonged disruptions around the Strait of Hormuz could trigger further increases in global energy costs.
