Bumper Nine Months For Saudi Petchems As Sabic Prepares For Aramco Buy-In

Saudi petchems firms continue to coin it on the back of bumper oil prices. Sabic is moving forward on restructuring: a deal to offload its fertilizers unit suggests reorganization for Aramco’s takeover is underway.

Saudi Arabia’s exchange-listed petrochemicals companies notched up record collective net profits of $7.7bn in the first nine months of 2018. Though crude prices are the key determinant of their profit margin given the indexing of Saudi chemicals prices to crude, profits are now above those seen when crude was over $100/B (see charts).

The 13 out of 14 companies reporting in recent weeks – small firm Alujain is again expected to report late – disclosed total net profits of $7.66bn for the first three quarters of 2018, up 33% on the $5.74bn for the same period in 2017 and up 2.7% on the $7.46bn previous periodic high in 2014. Yet quarterly earnings fell by 12% from $2.89bn in 2Q 2018 to $2.54bn in 3Q 2018, despite the higher oil price. (CONTINUED - 756 WORDS)

DATA INSIDE THIS ARTICLE

chart Saudi Petchems Firms 9m Net Profits Top 2014 Levels ($Bn)...
chart ...But Q3 Profits Ease From Record Q2 Despite Oil Prices Continuing To Edge Higher ($Bn)
chart Sabic Chemicals Output (MN T)