Saudi aramcos 2019 profit slumped 21 on low oil price cuts spending amid price war
According to reports, Saudi Aramco's net income for 2019 slumped by 21% due to a combination of factors, including:
- Low oil prices: The company's average crude oil price fell by 14% to $64.65 per barrel in 2019, compared to $75.15 per barrel in 2018. This decline in oil prices reduced the company's revenue.
- Spending cuts: Saudi Aramco reduced its capital expenditures by 23% to $15.6 billion in 2019, compared to $20.3 billion in 2018. This reduction in spending was aimed at conserving cash and reducing costs.
- Price war: The company was also affected by the price war between Saudi Arabia and Russia, which led to a global oil glut and downward pressure on oil prices.
As a result, Saudi Aramco's net income for 2019 fell to $88.2 billion, down from $111.1 billion in 2018. Despite this decline, the company still generated significant profits and remains one of the most profitable companies in the world.
It's worth noting that Saudi Aramco's financial performance was also impacted by the COVID-19 pandemic, which led to a significant decline in global oil demand and prices in 2020. The company's net income for 2020 fell by 45% to $47.2 billion, compared to $88.2 billion in 2019.