Aramco’s Resilience Strengthens its Ability to Weather Energy Market Volatility

Engineers monitor operations at a Saudi Aramco facility. (Aramco)
Engineers monitor operations at a Saudi Aramco facility. (Aramco)
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Aramco’s Resilience Strengthens its Ability to Weather Energy Market Volatility

Engineers monitor operations at a Saudi Aramco facility. (Aramco)
Engineers monitor operations at a Saudi Aramco facility. (Aramco)

Saudi Aramco’s second-quarter 2026 results underscored the company’s ability to maintain strong financial and operational performance despite geopolitical uncertainty and volatile energy markets.

Adjusted net income reached SAR125.2 billion ($33.4 billion) in the second quarter, while adjusted net income for the first half totaled SAR251.9 billion ($67.2 billion).

Cash flow from operating activities stood at SAR95.4 billion ($25.4 billion) in the second quarter and SAR210.6 billion ($56.2 billion) in the first half. Free cash flow reached SAR46 billion ($12.3 billion) during the quarter and SAR115.9 billion ($30.9 billion) in the first six months of the year.

The company’s board also approved a base dividend of SAR82.1 billion ($21.9 billion) for the second quarter, to be paid in the third quarter.

Cash flow enhances investment appeal

Mohammed Farraj, Senior Director of Asset Management at Arbah Capital, told Asharq Al-Awsat that Aramco’s results demonstrate the company has entered a new stage of operational and financial maturity. The quarterly performance, he said, reflects not merely strong numbers but the outcome of a long-term strategy and carefully planned investments in infrastructure and supply chains.

He continued that Aramco has shown exceptional resilience in navigating geopolitical challenges and energy market volatility, supported by diversified export routes, a strong financial position, and production costs that remain among the lowest in the industry. Those advantages have enabled the company to maintain stable, efficient operations.

Farraj cited first-half free cash flow of SAR115.9 billion ($30.9 billion) as a key indicator of Aramco’s robust cash-generating ability. He added that the temporary pressure from higher working capital in the second quarter was mainly related to inventory and receivables management and represented a short-term operational challenge with no impact on the company’s business quality or financial fundamentals.

He also said geopolitical uncertainty and declining global oil inventories have made markets more sensitive to potential supply disruptions, raising the risk premium. Highly efficient producers such as Aramco, he added, are well positioned to benefit from this environment while maintaining reliable energy supplies.

Dividends and growth projects

For his part, Dr. Hussein Al-Attas told Asharq Al-Awsat that the results reflect the resilience of Aramco’s business model and its ability to sustain strong profitability despite recent challenges in energy markets.

He attributed the performance to low production costs, integration across upstream, refining and petrochemical operations, and disciplined cost management.

He said Aramco’s ability to continue meeting global energy demand during a period of rapid geopolitical change demonstrates that it operates one of the world’s most integrated and reliable energy operations, reinforcing its position as a trusted supplier supporting global energy security.

On dividends, Al-Attas noted that maintaining the base payout at SAR82.1 billion ($21.9 billion) reflects the strength of the company’s cash flows and management’s confidence in its future ability to generate liquidity. The payout also enhances the stock’s appeal to investors seeking stable, long-term returns.

Highest yield among energy majors

Al-Attas highlighted that Saudi Aramco offers the highest dividend yield among the world’s energy majors, at around 5%, exceeding the 3.5% average dividend yield of the Saudi benchmark Tadawul All Share Index (TASI) and slightly surpassing the three-month Saudi Interbank Offered Rate (SAIBOR).

He added that the company increased its dividend by about 2% year on year, supported by earnings growth and its ability to maintain energy supplies, further enhancing the stock’s attractiveness for income-focused investors.

Al-Farraj noted that Aramco’s growing focus on natural gas, strategic investments, advanced technologies, and emissions-reduction solutions marks a significant shift in its strategic identity, transforming it from a traditional oil producer into an integrated global energy company.

He stressed that the expansion is aimed at diversifying growth drivers and reducing reliance on crude oil, in line with global shifts in the energy sector while strengthening the company’s long-term sustainability prospects.

Business continuity amid changing conditions

"Aramco's first-half performance in 2026 has been defined by the remarkable resilience of our people and the agility of our business and operations to withstand and respond to rapidly changing market conditions,” said Aramco President and CEO Amin Nasser.

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

He stated that geopolitical uncertainty and declining global inventories underscore the importance of energy security and the development of additional energy sources more than ever.

“Our role in swiftly responding to short-term market dynamics, coupled with our ability to ramp up production and focus on strategic investment and technology deployment, reinforce our continued position in the global economy,” he added.



Gold Slips as Focus Remains on Middle East, Rate Outlook

Gold bars, each weighing 1000 grams, displayed at a gold and silver refinery in Vienna (AFP)
Gold bars, each weighing 1000 grams, displayed at a gold and silver refinery in Vienna (AFP)
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Gold Slips as Focus Remains on Middle East, Rate Outlook

Gold bars, each weighing 1000 grams, displayed at a gold and silver refinery in Vienna (AFP)
Gold bars, each weighing 1000 grams, displayed at a gold and silver refinery in Vienna (AFP)

Gold prices slipped on Monday as market participants assessed developments in the Middle East and their implications for inflation and interest rates.

Spot gold fell 0.3% to $4,362.60 per ounce by 0417 GMT after hitting a one-week high on Friday. US gold futures were down 0.6% at $4,400.20, Reuters reported.

Iran and the United States exchanged new threats, with President ‌Donald Trump ‌warning Iran would fail economically or face its ‌leadership ⁠being wiped out ⁠if it didn't make a deal, and the Iranian military saying it would retaliate harshly to any fresh attack.

"The focus remains on geopolitics, oil and the reaction in bond yields. For gold to gain meaningful upside traction, a clear move lower in oil and/or bond yields is likely required," said Tim Waterer, chief market ⁠analyst at KCM Trade.

"Gold may trade in a ‌roughly $4,200 to $4,580 range in the near ‌term."

Oil prices fell on hopes diplomacy in the Iran war will ‌get a chance this week amid a UN meet.

The prospect of a new global rate-tightening cycle has come into focus as some of the world's top central banks ‌raise rates and signal more may be needed to tame inflation fueled by the Iran war.

The Bank ⁠of Japan ⁠became the latest big central bank to tighten on Friday, following rate increases by the Federal Reserve earlier that week and the European Central Bank the week before.

Though gold is often seen as an inflation hedge, rising rates tend to curb its demand by making interest-bearing assets more attractive.

Analysts at Standard Chartered said in a note that gold remains volatile but continues to find firm downside support from official-sector demand. They said structural drivers remain in place to lift prices, albeit at a slower pace.

Among other metals, spot silver rose 0.2% to $66.37, platinum fell 0.1% to $1,798.31 and palladium added 0.6% at $1,309.65.


Qatar Launches Wealth Fund Division for Domestic Investments

Qatari flag flutters in Doha - AAWSAT/File
Qatari flag flutters in Doha - AAWSAT/File
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Qatar Launches Wealth Fund Division for Domestic Investments

Qatari flag flutters in Doha - AAWSAT/File
Qatari flag flutters in Doha - AAWSAT/File

Qatar's prime minister announced on Sunday the creation of a new division of the Qatar Investment Authority dedicated to developing domestic investments.

"We aim to expand the role of the private sector in driving Qatar's economic growth," Sheikh Mohammed bin Abdulrahman Al Thani said as he announced the new division, Doha Investment, at a special edition of the Qatar Economic Forum in New York.

The annual gathering was cancelled in May, following weeks of Iranian missile and drone attacks on Gulf states, including Qatar, according to Reuters.

"It will support our strongest companies, help emerging businesses grow, deepen capital markets and attract international capital and expertise to contribute to this effort," he added.

The new division will operate as the dedicated manager of QIA's local portfolio, initially overseeing 45 state-owned enterprises that represent roughly one-third of the wealth fund's total assets, according to Sheikh Faisal bin Thani Al Thani, Qatar's minister of commerce and industry. He will serve as managing director and vice-chairman of Doha Investment.

Sheikh Faisal described the division not as a new creation but a consolidation, adding that the step has been under consideration for more than a decade.


PIF Launches Tawrid to Provide Supply-Chain Financing Products in Saudi Arabia

PIF Tower at the King Abdullah Financial District in Saudi Arabia’s capital, Riyadh (Asharq Al-Awsat)
PIF Tower at the King Abdullah Financial District in Saudi Arabia’s capital, Riyadh (Asharq Al-Awsat)
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PIF Launches Tawrid to Provide Supply-Chain Financing Products in Saudi Arabia

PIF Tower at the King Abdullah Financial District in Saudi Arabia’s capital, Riyadh (Asharq Al-Awsat)
PIF Tower at the King Abdullah Financial District in Saudi Arabia’s capital, Riyadh (Asharq Al-Awsat)

The Public Investment Fund (PIF) on Sunday announced the launch of Tawrid Company for Financing Solutions, an innovative digital platform providing supply-chain financing products to companies in the Saudi Arabian market. Tawrid has obtained the Saudi Central Bank (SAMA) permit to operate under the regulatory Sandbox environment.

The financial services industry is a strategic enabler of the six ecosystems that PIF announced recently as part of its 2026-2030 strategy.

Supply-chain financing products help companies to fund their broader activities. Tawrid’s digital offering will further strengthen the Saudi private sector, particularly small and medium-sized enterprises, SPA reported.

Tawrid will play a significant role in connecting buyers, suppliers, and funders through its digital platform. It will offer products such as early settlement options against approved invoices, enabling businesses to expand their operations, enhance their working capital efficiency, and improve their liquidity management.

The launch of Tawrid is in line with PIF’s strategy to increase the Saudi private sector’s contribution to PIF’s projects and portfolio companies and to grow the private sector’s share of the local economy. Its platform will enable local banks registered on its network to engage with registered suppliers, strengthening supply chains and further supporting the diversification of financial services and the digitalization of trade in Saudi Arabia.

PIF’s investment in supply-chain financing is a natural evolution that builds on its efforts to advance the growth, resilience, and robustness of supply chains in the Saudi market. PIF has expanded opportunities for local suppliers and stimulated them to develop their capabilities in line with PIF’s strategic objectives to engage the private sector and enable it to contribute to a more diversified economy with deep, local, tech-enabled supply chains.

Head of Financial Institutions in MENA Investments at PIF Sultan Alsheikh said: “Tawrid will make Saudi supply chains stronger and more resilient by further enabling companies to access financing and improve their liquidity management. Its supply-chain financing products will enable businesses to operate with greater agility and efficiency, creating opportunities for the Saudi private sector in particular.”

Tawrid has started operations and has already signed binding agreements with local banks and companies, including Gulf International Bank (GIB), Saudi National Bank (SNB), Banque Saudi Fransi (BSF), ROSHN Group and Nesma & Partners.
PIF is one of the world’s most impactful investors, with a long-term investment strategy to further drive the economic transformation of Saudi Arabia and deliver sustainable financial returns.