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Oil giant Saudi Aramco beats estimates by 30% increase in profit in first quarter

Oil tanks at an oil treatment plant in Saudi Aramco, a Saudi state-owned oil and gas company, at the Abqaiq oil field.

Stanislav Krasilnikov | TASS via Getty Images

Oil giant Saudi Aramco reported a 30% increase in net income on Tuesday as a sign of a continued recovery from the previous year̵

7;s oil market crash, which saw full-year earnings for the state-owned company cut in half.

In a release released Tuesday, the company said net income rose to $ 21.7 billion. In the first three months of the year, up from $ 16.6 billion. In the same period last year.

That beat some analysts’ estimates of $ 17.24 billion. Despite lower oil production in February and March. The figure is approaching the company’s net income level in the first quarter of 2019, which was $ 22.2 billion.

Saudi Arabia’s producer of behemoth oil also maintained its $ 18.8 billion dividend to be paid in both the first and second quarters.

Earnings reflect a dramatically improved climate for the oil markets since the first quarter of last year, when Aramco reported a 25% drop in net revenue in the period as it struggled with the initial downturn in the coronavirus pandemic and cratering global demand.

The company said free cash flow in the first quarter was $ 18.3 billion. Up from $ 15 billion In the same period last year.

Aramco, like its global peers, has navigated an uncertain oil price environment and unpredictable global economic recovery. The company described 2020 as “the most challenging year” in its history and now benefits from the recovery in the oil markets with the international benchmark Brent crude prices, which is about double what they were this time last year. Margins for refining and chemicals are also starting to improve.

“The momentum of the global economic recovery has strengthened energy markets,” Aramco President and CEO Amin Nasser said Tuesday in a press release from the company. He added that “there are still some headwinds”, but said: “Given the positive signs of energy needs in 2021, there are several reasons to be optimistic that better days will come.”

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