Aramco Profit Dips 12% in 2025 as Price Volatility Bites

Saudi Aramco, the world’s largest oil exporter, reported a 12.1% drop in its full-year 2025 net profit on Tuesday, March 10, 2026. The company’s net income fell to $93.4 billion, down from the previous year, as a combination of lower crude oil prices and reduced sales volumes pressured the bottom line of the state-owned energy giant.

The Numbers: A Year of Volatility

Despite the dip, Aramco remains one of the world’s most profitable entities, though the results narrowly missed analyst expectations of $95.6 billion.

• Net Income: $93.4 billion (FY 2025) vs. ~$106 billion (FY 2024).
• Q4 Slump: The fourth quarter was particularly tough, with net profit falling 20.5% to $17.8 billion, primarily due to rising operating costs and asset impairment charges related to its chemicals subsidiary, SABIC.
• Dividend Boost: In a move to reassure investors, the board increased the base dividend by 3.5% to $21.89 billion for the fourth quarter, marking the fourth consecutive year of dividend growth.
• Capital Spending: The firm maintained a disciplined stance with $52.2 billion in capital expenditure for 2025, with plans to spend between $50 billion and $55 billion in 2026.

Why Did Profits Fall?

The 12% decline is attributed to a “perfect storm” of macroeconomic and geopolitical factors that defined the 2025 fiscal year.

1. Weaker Crude Benchmarks

While 2026 has seen a war-driven spike in oil prices, the majority of 2025 was characterized by subdued prices and economic headwinds. Average realized crude prices for Aramco were significantly lower than the previous year, directly impacting revenue from its core Upstream operations.

2. Higher Operating Costs & Impairments

Operating costs rose to $69.7 billion in the final quarter of 2025. This was exacerbated by fair value losses and impairments as SABIC (Saudi Basic Industries Corp) moved to divest certain petrochemical and engineering businesses in Europe and the Americas.

3. Production Cuts & “Price Equalization”

To support global market stability, Saudi Arabia maintained voluntary production cuts throughout much of 2025. Lower volumes of crude and refined products sold at regulated prices led to reduced “price equalization” compensation from the government, further squeezing margins.

Looking Ahead: The “Hormuz” Threat

CEO Amin Nasser warned that while the 2025 results were “robust” given the volatility, the current geopolitical climate in 2026 presents a new set of risks. With the Strait of Hormuz currently a focal point of the Iran-Israel conflict, Aramco is rerouting tankers to its Red Sea ports.

“Aramco delivered strong cash flows in 2025, reinforcing confidence in our strategy. However, the situation at the Strait of Hormuz is blocking sizable volumes… if this takes a long time, it will have a serious impact on the global economy.” — Amin Nasser, CEO