Aramco’s Adjusted Q2 Profit Jumps 33% Despite Supply Disruption

RIYADH: Saudi Aramco reported second-quarter adjusted net income of $33.4 billion, up 33 percent year on year, as the state oil giant weathered unprecedented disruption through the Strait of Hormuz while maintaining production and exports to global markets.

 

The company’s board declared a second-quarter base dividend of $21.9 billion, payable in the third quarter, even as free cash flow fell to $12.3 billion from $18.6 billion in the prior quarter, a drop Aramco attributed largely to a $13.6 billion working capital build. 

Gearing rose to 6.2 percent from 4.8 percent at the end of March, though it remained broadly in line with the 6.5 percent recorded a year earlier. 

The scale of the disruption behind these numbers is captured in official data from the US Energy Information Administration, which showed crude oil and petroleum liquids transiting the Strait of Hormuz fell nearly 30 percent to 14.6 million barrels a day from 20.4 million a year earlier, as the corridor, which normally carries about a fifth of the world’s oil trade, was choked by regional conflict. 

Aramco President and CEO Amin Nasser revealed the company’s ability to keep operating through the turmoil reflected years of planning, saying: “Despite the unprecedented supply disruption through the Strait of Hormuz, we continued to demonstrate our ability to maintain business continuity by capitalizing on our diverse asset base and multi-decade planning, including strategic infrastructure such as the East-West Pipeline, storage capacity, and export terminals.”  

He added: “That enabled us to sustain production and exports while advancing key projects, despite the challenging regional environment.” 

In an interview with Arab News, economist Jassem Ajaka said the strong performance is particularly significant because it comes at a time of heightened market volatility and regional geopolitical uncertainty.

“Aramco was able to weather the Strait of Hormuz-related logistical issues and disruption, and avoided the high costs of logistical services, leaving crude oil prices as the main factor behind these earnings,” he explained.

Aramco’s ability to contain the physical risks resulting from the Iran attacks also contributed to these results, though the damage was not significant and did not materially affect operations, Ajaka added.

Facilities targeted in attacks 

Aramco disclosed that certain facilities belonging to the company and its affiliates in the Kingdom were targeted in attacks during the second quarter and again in July. As of June 30, the company said the impact on these facilities was “not material” to its financial position, results of operations, or cash flows, though it will continue to assess the risk of further incidents. 

How Aramco kept the oil flowing

On the earnings call, Aramco’s president detailed the operational playbook behind the company’s resilience, citing optionality across three export routes — the Arabian Gulf, Red Sea, and Mediterranean — alongside continued use of the East-West Pipeline and international storage in Asia, Europe, and the Middle East to keep supplying customers through the crisis.

Nasser also said Aramco’s group-wide contingency teams restored affected assets roughly six times faster than industry peers, drawing on a supply chain with 70 percent local content.

Ajaka said that Aramco's continued dividend payments speak to how the company was built around flexibility.

“That flexibility is evident in the alternative East-West Pipeline, which was used when the Strait of Hormuz transportation was disrupted.

 Strong storage capacity also played a role as a buffer, keeping operations uninterrupted,” he added.

Higher prices offset lower volumes 

Revenue and other income related to sales climbed to $139.1 billion in the second quarter, up from $108.6 billion a year earlier, driven by higher crude oil, refined product and chemical prices that more than offset lower volumes sold. The average realized crude oil price jumped to $108.10 a barrel in the quarter, up sharply from $76.90 in the first quarter and $66.70 a year earlier. 

First-half performance  

Over the six-month period, Aramco’s adjusted net income rose 29 percent year on year to $67.2 billion, while net income climbed 34 percent to $65.2 billion from $48.7 billion in the first half of 2025. 

Chief Financial Officer Ziad Al-Murshed said the results underscored the resilience of Aramco’s integrated model: “Our resilience stems from decades of long-term planning and our strategic domestic and international infrastructure that provide flexibility and optionality. This positioning supports our ability to deliver strong results even in a complex environment.” 

Revenue and other income related to sales reached $263.7 billion during the period, compared with $223.1 billion a year earlier, as the average realized crude oil price rose to $90.10 a barrel from $71.50. 

Free cash flow, however, slipped to $30.9 billion from $34.4 billion, primarily reflecting higher amounts due from the government and inventories, which offset the earnings gains. 

The company paid base dividends of $43.8 billion during the first half, reflecting what Nasser called a “sustainable and progressive” approach to shareholder returns even amid regional uncertainty. 

Upstream and downstream diverge 

Upstream adjusted EBIT slipped to $50.9 billion in the second quarter from $54.2 billion in the previous quarter, as lower crude oil volumes sold and higher production royalties outweighed the benefit of higher prices. 

Total hydrocarbon production fell to 9.5 million barrels of oil equivalent per day from 12.6 million in the first quarter. 

Downstream, by contrast, posted adjusted EBIT of $6.2 billion, up 25 percent quarter on quarter on stronger refining margins, and maintained supply reliability of 98.4 percent despite the regional turmoil. 

Portfolio optimization 

Aramco pressed ahead with strategic projects and portfolio optimization during the quarter. It signed an agreement to sell its entire equity interest in the PRefChem refining and petrochemical joint venture in Malaysia to PETRONAS, and construction continued on the Zuluf crude oil increment and the Fadhili Gas Plant expansion, which are targeted for completion in 2026 and 2027, respectively. 

The company also completed a $4 billion international bond issuance in February and continued its share repurchase program, having repurchased 83.8 million shares for $0.61 billion as of June 30.