Saudi Aramco Profits Drop 22% as It Plans Cost Cuts and Sells Assets

Saudi oil giant Aramco reported a 22% fall in profit for the second quarter of 2025 as oil prices dropped and debt increased. The company is now planning cost cuts and asset sales to raise money.

📊 Key Numbers:

• Q2 profit: $22.7 billion (down from $29.1 billion last year)

• Adjusted net income: $24.5 billion (slightly better than expected)

• Average oil price: $66.7 per barrel (down from $85.7 last year)

🏦 What’s Changing?

• Aramco is selling low-return assets, such as infrastructure and possibly five power plants, to focus on more profitable areas.

• It may raise $10 billion from a deal led by BlackRock.

• Debt increased to $92.9 billion, and gearing (debt-to-equity ratio) rose to 6.5%.

💸 Dividends Drop Sharply:

• Total dividends for 2025: $85.4 billion (down 31% from 2024)

• Performance-based bonuses: Down 98%

• Free cash flow (cash after expenses): Dropped 19% to $15.2 billion

🇸🇦 Why It Matters for Saudi Arabia:

• Aramco is major income source for the government.

• Saudi government owns 97.5% of Aramco through direct holdings and its wealth fund (PIF).

• Oil still makes up 62% of Saudi state income.

• Experts say Saudi Arabia may run a 5% budget deficit in 2025 — more than double what was planned.

🛢️ Oil Prices Today:

• Brent crude was trading at $68.83 — well below the $90+ price Saudi needs to balance its budget, according to the IMF.