Saudi Aramco is keeping its huge dividend of $31.1 billion for the first quarter despite a decline in net income due to lower crude sales as the Kingdom is voluntarily restricting supply to the market.
Aramco, the state oil giant of the world's top crude oil exporter and the largest oil firm globally, reported on Tuesday a net income of $27.3 billion for the first quarter of 2024, down from $31.9 billion for the same period of 2023, due to lower crude oil volumes sold, weakening refining and chemicals margins, and lower finance and other income. This was partially offset by lower production royalties and an increase in crude oil prices compared to the same period last year, the Saudi company said.
Cash flow from operating activities and free cash flow both fell in the first quarter from a year earlier. Free cash flow declined to $22.8 billion from $30.9 billion, and cash flow from operating activities dropped to $33.6 billion from $39.6 billion.
Aramco is set to pay in the second quarter a Q1 2024 base dividend of $20.3 billion and the fourth performance-linked dividend distribution of $10.8 billion.
"In line with its aim to maximize value for shareholders, the Board declared a base dividend of SAR 76.1 billion ($20.3 billion) and the fourth distribution of the performance-linked dividends of SAR 40.4 billion ($10.8 billion), bringing the total declared dividends for the first quarter to SAR 116.5 billion ($31.1 billion)," the Saudi oil giant said.
"Aramco believes it is well positioned to help meet the world's growing need for affordable and reliable energy, and that oil and gas will continue to be an important part of the global energy mix," it added.
In the first quarter, Saudi Aramco made "significant progress" on expanding its natural gas business and growing its globally-integrated downstream value chain, while maintaining focus on consistently delivering value for shareholders, president and CEO Amin Nasser said.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com More
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