Saudi Aramco half-year profits plunge 50% from virus impact
Dubai: Saudi Aramco's net income plunged by 50% in the first half of the year, according to figures published on Sunday, offering a revealing glimpse into the impact of the coronavirus pandemic on one of the world's biggest oil producers.
Profits for the first six months of the year plunged to 23.2 billion, half of last year's 46.9 billion for the same time period.
The results were announced as Aramco's second quarter earnings dipped to 6.6 billion compared to 24.7 billion during the same time last year, reflecting a staggering 73% drop.
The majority state-owned company's financial health is crucial to Saudi Arabia's stability. Despite massive efforts by Saudi Crown Prince Mohammed bin Salman to diversify the economy, Saudi Arabia still depends heavily on oil exports to fuel government spending.
The price of Brent crude hovers just under 45 a barrel, significantly less than before the pandemic but up from a low of around 21 a barrel in April.
Aramco CEO Amin Nasser acknowledged the company's finances were impacted by strong headwinds from reduced demand and lower oil prices" sparked by the pandemic, which halted flights around the world and plunged economies into recession, including Saudi Arabia's.
The company said it will uphold its commitment to pay out dividends of 18.75 billion for the second quarter as part of its promise to pay 75 billion in annual dividends.
Nasser described Aramco's half-year earnings as solid and credited the company's low production costs and operational strength, which helped it to maintain its promised dividend payments.
Aramco was knocked out of it's top spot as the world's most valuable listed company by Apple in recent days.
It's stock price gained a little on Sunday, trading at around 33 riyals ( 8.80) a share. At its highest, Aramco traded above 10 a share in December and at it lowest slipped to 7.20 a share in March.
Looking ahead, Nasser said the energy market is seeing a partial recovery as countries around the world ease restrictions and reboot their economies.
We are determined to emerge from the pandemic stronger and will continue making progress on our long-term strategic journey, through ongoing investments in our business, Nasser said.
Even before the half-year results were announced, it was clear Aramco's half-year earnings would take a hit with the company's first quarter profits down 25%.
Aramco, which floated a sliver of its shares on the local Saudi stock market last year, had long kept its financial details a closely-held secret until the company began preparations for its market debut.
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Min. Priyank Kharge to expresses concern over implementation of VB-G Ram G
Bengaluru: Rural Development and Panchayati Raj Minister Priyank Kharge has expressed concern over the uncertainty surrounding the implementation of the proposed VB-G Ram G scheme, stating that the MNREGA programme, which has been a lifeline for rural India for nearly two decades, appears to be facing an uncertain future.
Speaking to media, Kharge said that as March 31 draws to a close, there is no clarity on the rollout of the new scheme from April 1. He pointed out that the central government has not yet issued the necessary guidelines for implementing the scheme for rural workers and villages.
He criticised the Centre for its lack of preparedness, stating that there is no clarity on fund allocation, no final parameters for classifying gram panchayats, and key processes such as social audits have not been defined.
Kharge said the situation comes at a critical time, as summer marks a peak period for rural employment demand, when many people depend heavily on wage employment for their livelihood.
He added that reports have emerged of delays in approvals and families not receiving work despite demand.
He further alleged that the Centre’s move to shift from a statutory employment guarantee to a rule-based allocation system is already showing negative consequences.
Kharge also raised concerns over provisions such as a mandatory 60-day halt during agricultural seasons, which he said would further limit employment opportunities for rural workers.
The BJP-led central government had claimed that the new scheme would transform rural India, but in reality it is turning out to be detrimental to people’s livelihoods, he said.
“The crisis in rural India due to the stalling of MNREGA is beginning to unfold. Given the Centre’s past record in handling such situations, there is growing concern over the impact on rural livelihoods,” Kharge said.
