Saudi Aramco Unveils $3 Billion Buyback and Raises Dividend

Article content(Bloomberg) — Saudi Aramco approved a $3 billion share buyback program and raised its dividend payout, as it looks to shore up sentiment after the war in the Middle East hit the company’s operations.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe surprise move to repurchase stock, the company’s first ever since it listed in 2019 in a mega public offering, and the higher dividend follow in the wake of a series of operational setbacks over the past week. Aramco pared back oil output and shut Saudi Arabia’s biggest refinery following a drone attack. Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe company has been rushing to reroute some exports as the Strait of Hormuz remains at a near-standstill. Oil has surged, potentially softening the impact of the reduced production on Aramco. Crude topped $100 a barrel on Monday before easing as US President Donald Trump said the Iran war might end soon.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentThe higher dividend will benefit the Saudi government and the kingdom’s sovereign wealth fund, which together own about 97% of Aramco. The Saudi government partly depends on Aramco’s huge payout for its multitrillion-dollar economic diversification plan. Article contentAramco’s shares have risen about 14% this year, lagging behind oil supermajors Shell Plc, Exxon Mobil Corp. and Chevron Corp. BP Plc halted its own stock repurchases to shore up its balance sheet, while Shell maintained it.Article contentFree Cash FlowArticle contentThe world’s biggest oil exporter said it’s base dividend will rise to $21.9 billion for the quarter ended Dec. 31, a 3.5% increase from the preceding quarter, Aramco said in a statement Tuesday. That matched the consensus analyst estimate compiled by Bloomberg.Article contentThe company’s free cash flow — funds left over from operations after accounting for investments and expenses — rose to $27.5 billion in the quarter, which covered the total dividend for a second-straight quarter after falling short for a prolonged period previously.Article contentSaudi Aramco plans to repurchase up to 350 million ordinary shares over 18 months starting this in March, which the company may retain for a maximum of 10 years. Article contentThe near-closure of the Strait of Hormuz has brought about a nightmare situation for the energy industry as exports remain clogged. It’s resulted in storage tanks rapidly filling up, with major OPEC producers Iran, Kuwait and the United Arab Emirates also lowering oil production.Article contentTrending Vietnam Plans to Scrap Fuel Import Curbs to Keep Supply Flowing PMN Business Here's why bets are rising for interest rate hikes including for Canada Economy Qatar to push LNG expansion plans to 2027 after Iran drone attack Oil & Gas Subscriber only. It's been five years since mortgage rates hit all-time lows, and no one is celebrating this anniversary Subscriber only Personal Finance Vast Ship Clusters and Speeding Tankers Point to Hormuz Jamming PMN Business Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Vietnam Plans to Scrap Fuel Import Curbs to Keep Supply Flowing PMN Business Here's why bets are rising for interest rate hikes including for Canada Economy Qatar to push LNG expansion plans to 2027 after Iran drone attack Oil & Gas Subscriber only. It's been five years since mortgage rates hit all-time lows, and no one is celebrating this anniversary Subscriber only Personal Finance Vast Ship Clusters and Speeding Tankers Point to Hormuz Jamming PMN Business