Aramco Profit Rises 9% as Analysts Look to Export Recovery for Further Growth

Recovering exports, with a price trade-off

Aramco's deliveries showed signs of recovery despite production remaining below year-earlier levels. Vijay Valecha, chief investment officer at Century Financial, said liquids output increased 15% from the previous quarter and October exports reached their pre-war level of about 7 million barrels a day.

Valecha said reduced regional tensions could support higher production and sales. But James Wright, senior trader at Lunaro Financial Services Limited, cautioned that a US-Iran deal would most likely lower prices as volumes recovered. Whether earnings improve would depend on how those changes balance out.

The company said its East-West Pipeline gave it flexibility to export during the quarter. It is exploring more overseas storage and other export routes. Its third-quarter results presentation also outlined an engineering review of a possible pipeline capacity increase from 7 million to 10 million barrels a day, alongside an assessment of alternative routes through its master gas system.

Aramco estimated that regional conflicts have disrupted more than 3 billion barrels of global oil supply since they began. Strategic petroleum reserve releases and alternative export routes reduced the cumulative net shortfall to about 2 billion barrels, according to the presentation.

"Geopolitical uncertainty and attacks on key energy facilities continued to amplify the global energy supply crisis in the third quarter of 2026, with serious implications for global energy security," Aramco President and CEO Amin H. Nasser said in the results announcement.

Production losses limit the benefit of higher prices

The adjusted profit beat a median forecast of $30.66 billion from 12 analysts in a company-shared consensus, CNBC reported on November 3, 2026. Wright noted, however, that it was below the preceding two quarters, while underlying earnings before interest and taxes were nearly unchanged.

The gap between prices and output explains the mixed performance. Madhur Kakkar, founder and CEO of Elevate Financial Services, said Aramco received an average of $95.2 per barrel of crude, compared with $70.1 a year earlier, but total hydrocarbon production declined 17%. Wright said reduced volumes and higher royalties more than absorbed the upstream benefit from higher prices.

Aramco's results presentation put upstream adjusted earnings before interest and taxes, or EBIT, at $46.8 billion, down 9% year over year. It attributed the decline to lower production volumes earlier in the year because of regional disruptions.

The increase in reported profit was much larger than the adjusted gain. Wright said reported net income reached $36.3 billion, up about 35%, and included a $6.9 billion gain on the sale of Aramco's PRefChem stake. Kakkar favored the adjusted measure as a clearer view of performance because it removes one-time items.

Refining offsets upstream pressure

Downstream operations delivered adjusted EBIT of $10.3 billion, a 234% increase, according to the analysts. The improvement helped counter the weaker production business. "Refining proved its value," Valecha said.

The company's presentation showed how sharply refining margins had risen. For March through September 2026, margins reached records of $21 per barrel in Asia, $25 in Europe and $27 in the United States. The corresponding figures for January and February were $4, $2 and $4.

"For GCC investors, the key takeaway is that Aramco's integrated model is cushioning lower production through stronger prices and refining margins," Kakkar said.

That protection is not assured as supply conditions normalize: fewer disruptions could allow Aramco to sell more crude while also reducing the margins it earns from refining.

Quarterly cash covers the dividend, but the year-to-date gap remains

Quarterly free cash flow increased about 19% to $28.2 billion, providing roughly 1.3 times coverage of the $21.9 billion base dividend. The board declared a payout 3.5% above the year-earlier level, payable in the fourth quarter of 2026. "The dividend looks secure, which matters for both shareholders and the state," Valecha said.

Wright nevertheless noted that free cash flow for the year to date remained below dividend payments. Separately, Aramco's presentation reported $87.4 billion in free cash flow excluding working capital changes for the first nine months of 2026, a 35% year-over-year increase.

Gearing declined from 6.2% three months earlier to 5.5% as of September 30. Aramco also reported a rolling 12-month return on average capital employed of 22.1%. The company characterized that return as industry-leading and its gearing as the lowest among global peers.

Kakkar attributed part of the improvement in cash generation to capital expenditure falling 16% to $10.5 billion. Aramco kept its full-year 2026 spending guidance at $50 billion to $55 billion, including restoration costs associated with regional disruptions and its approximately $2.6 billion acquisition of a 49% stake in Saudi artificial intelligence venture HUMAIN. The Public Investment Fund owns the remaining 51%.

The next quarter will test whether recovering sales can compensate for any retreat in the prices and margins that supported these results. "The fourth-quarter test is whether refining margins remain elevated and whether any recovery in volumes can offset moderation in prices and margins," Kakkar said.