On March 22, 2021 Energy giant Saudi Aramco posted a 44.4 % slump in 2020 net profit due to lower crude prices, as the coronavirus pandemic weighed heavily on global demand.

Over 98% of the company is owned by the Saudi government and is the main source of revenue to the Saudi Arabian government. The group’s dividends play a critical role in helping the Saudi government to manage its fiscal deficit.

“Aramco achieved a net income of $49 billion in 2020,” the company said in a statement, down from $88.2 billion in 2019.

Amin NASSER, Aramco chief executive said that 2020 was “one of the most challenging years in recent history“.

“Revenues were impacted by lower crude oil prices and volumes sold, and weakened refining and chemicals margins,” said the Company.

“We are pleased that there are signs of a recovery,” NASSER told an earnings call. “China is also very close to pre-pandemic levels. So, in Asia, East Asia in particular, there is a strong pick-up in demand”.

He said demand in Europe and the US would improve with more deployment of vaccines against COVID-19. Global oil demand is expected to reach 99 million barrels per day by the end of this year, he added.

Crude prices have risen in recent weeks to more than $60 per barrel.

But in the short term, analysts say the Saudi giant is bracing for a possible further wave of coronavirus infections that could undermine a tentative global economic recovery.

Aramco said it stuck to its commitment of paying shareholders dividends worth $75 billion in 2020, an amount that exceeds the declared profit.

A drop in oil income is expected to hinder Crown Prince Mohammed bin SALMAN’s ambitious “Vision 2030” reform programme to overhaul the kingdom’s energy-reliant economy.

NASSER said: “As the enormous impact of COVID-19 was felt throughout the global economy, we intensified our strong emphasis on capital and operational efficiencies”.

There are also concerns over an uptick in drone and missile attacks on Aramco’s facilities in the kingdom, claimed by Yemen’s Houthi rebels.

A drone strike sparked a fire at a Riyadh oil refinery on Friday, in the second major assault this month on Saudi energy installations claimed by the Iranian-aligned group.

Amin NASSER said: “The attack on Riyadh is a good demonstration, within hours of putting out the fires and finishing the investigation, we started putting the facility (back) on”. “Today the Riyadh refinery started to come onstream. So, it is a demonstration of the capability and the contingency plan and the emergency response of first responders.”

This article was edited using the data from the Aljazeera.com, Energy.economictimes.indiatimes.com, Dw.com and, Cnbc.com.