Q2 2026 Saudi Arabian Oil Co Earnings Call

August 4, 2026

Speaker #1: Welcome to Saudi Aramco's half-year 2026 results call. We will be holding a Q&A session following the presentation. If you'd like to ask a question, please press star followed by 1 on your telephone keypad at any time.

Operator: Welcome to Saudi Aramco's H1 2026 results call. We will be holding a question and answer session following the presentation. If you'd like to ask a question, please press star followed by one on your telephone keypad at any time. I'll now hand over to Mr. Peter Hutton to begin.

Operator: Welcome to Saudi Aramco's H1 2026 Results Call. We will be holding a question-and-answer session following the presentation. If you'd like to ask a question, please press star followed by one on your telephone keypad at any time. I'll now hand over to Mr. Peter Hutton to begin.

Speaker #1: Also, now I'll hand over to Mr. Peter Hutton to begin.

Speaker #2: Hello, and welcome to Aramco's second quarter 2026 earnings call. I'm Peter Hutton, Head of Investor Relations, and I'm pleased to be joined today by Amin Nasser, President and CEO, and Ziad Al Mashed, Executive Vice President and CFO.

Peter Hutton: Hello, welcome to Aramco's Q2 2026 earnings call. I'm Peter Hutton, Head of Investor Relations, and I'm pleased to be joined today by Amin Nasser, President and CEO, and Ziad Al-Murshed, Executive Vice President and CFO. Today, we will provide a detailed update followed by a question and answer session. We expect the call to last around an hour. Please refer to this cautionary statement on forward-looking information, our regulatory filings, and our website for more details. With that, I will hand the call over to Amin.

Peter Hutton: Hello, welcome to Aramco's Q2 2026 Earnings Call. I'm Peter Hutton, Head of Investor Relations, and I'm pleased to be joined today by Amin Nasser, President and CEO, and Ziad Al-Murshed, Executive Vice President and CFO. Today, we will provide a detailed update followed by a question and answer session. We expect the call to last around an hour. Please refer to this cautionary statement on forward-looking information, our regulatory filings, and our website for more details. With that, I will hand the call over to Amin.

Speaker #2: Today, we will provide a detailed update, followed by a Q&A session. We expect the call to last around an hour. Please refer to this Q&A statement on forward-looking information, our regulatory filings, and our website for more details.

Speaker #2: With that, I will hand the call over to Amin.

Speaker #3: Thank you, Peter. Welcome, everyone, and thank you for joining us. The recent quarter was one of the most challenging ever in the history of Saudi Aramco.

Amin Nasser: Thank you, Peter. Welcome everyone, and thank you for joining us. The recent quarter was one of the most challenging ever in the history of Saudi Aramco. Our resolve and resilience were tested like never before. We have continued to overcome the challenges and continue to deliver for our shareholders. We have demonstrated great agility and adaptability in the face of threats and attacks on our facilities, and in finding solutions and workarounds in dealing with the disruption to shipping in the Strait of Hormuz. This time, I would like to acknowledge the efforts of our employees, our contractors, and partners who represent and support the Aramco group of companies in Saudi Arabia and around the world. This is the third set of results we have reported since the disruption to global trade via the Strait of Hormuz.

Speaker #3: Our resolve and resilience were tested like never before. But we have continued to overcome the challenges and continue to deliver for our shareholders. We have demonstrated great agility and adaptability in the face of threats and attacks on our facilities, and in finding solutions and workarounds in dealing with the disruption to shipping in the Strait of Hormuz.

Speaker #3: This time, I would like to acknowledge the efforts of our employees, our contractors, and partners who represent and support the Aramco Group of companies in Saudi Arabia and around the world.

Speaker #3: This is the third set of results we have reported since the disruption to global trade by the Strait of Hormuz. The prolonged US-Iran conflict continues to aggravate the biggest ever energy supply shock in history, removing an average of 11 million barrels per day of liquid supply.

Amin Nasser: The prolonged US-Iran conflict continues to aggravate the biggest ever energy supply shock in history, removing an average of 11 million barrels per day of liquid supply. During this time of unprecedented volatility and uncertainty, our strategy, focus, and delivery have been clear and consistent. The consistency is what you expect from Aramco. We balance short-term market events with a strong long-term vision. It is that steady delivery that has made us a leading global energy partner for our customers and investors. In March, we highlighted the flexibility we have long built into our operations. We showed how effectively that flexibility is executed from our East-West Pipeline to a diverse asset base. In May, we reported the impact of delivering on these plans and actions from both our operations and financial results.

Speaker #3: During this time of unprecedented volatility and uncertainty, our strategy, focus, and delivery have been clear and consistent. The consistency is what you expect from Aramco.

Speaker #3: We balanced short-term market events with a strong long-term vision. It is that steady delivery that has made us a leading global energy partner for our customers and investors.

Speaker #3: In March, we highlighted the flexibility we have long built into our operations. We showed how effectively that flexibility is executed, from our east-west pipeline to a diverse asset base.

Speaker #3: In May, we reported the impact of delivering on these plans and actions from both our operations and financial results. Today, we are building further on our strategy, continuing to create and capture opportunities in our operations, having developed multiple routes to market, including via the Mediterranean, and delivering strong results despite this being the first full quarter where the depth of the crisis applied throughout.

Amin Nasser: Today, we are building further on our strategy, continuing to create and capture opportunities in our operations, having developed multiple routes to market, including via the Mediterranean and delivering strong results despite this being the first full quarter where the depth of the crisis applied throughout. The strength of our financial is reflected in Q2 adjusted net income of $33.4 billion, up 33% compared to last year. This includes an exceptional downstream adjusted EBIT of $6.2 billion, around twice that of a year ago. We have delivered these results while maintaining the strongest balance sheet in the industry, with gearing of 6.2% and 22.1% ROACE, which is around double the IOC's average. This strength allows us to continue returning value to our shareholders with our Q2 base dividend up 3.5% year on year.

Speaker #3: The strength of our financials is reflected in second-quarter adjusted net income of $33.4 billion, up 33% compared to last year. This includes an exceptional downstream adjusted EBIT of $6.2 billion, around twice that of a year ago.

Speaker #3: We have delivered these results while maintaining the strongest balance sheet in the industry, with gearing of 6.2% and 22.1% Rawashi, which is around double the IOC's average.

Speaker #3: It is this strength that allows us to continue returning value to our shareholders, with our Q2 base dividend up 3.5% year on year. In May, we were also clear that the trade disruptions are the most serious we have ever seen in the energy market, and that if this route did not fully open by the end of that month, the impact would continue well into 2027.

Amin Nasser: In May, we were also clear that the trade disruptions are the most serious we have ever seen in the energy market, and that if the Strait did not fully open by the end of that month, the impact would continue well into 2027. As we have seen, trade flows via the Strait have not normalized since then, and the impacts are even more severe. The measures taken by various industry participants, such as the use of inventories to mitigate the impact, have had short-term effects. The release of inventories has now been largely deployed and are not only more difficult to be maintained, but now need to be rebuilt from critically low levels.

Speaker #3: As we have seen, trade flows via the Strait have not normalized since then, and the impacts are even more severe. The major stake-in by various industry participants, such as the use of inventories to mitigate the impact, has had short-term effects. The release of inventories has now been largely deployed, and inventories are not only more difficult to maintain, but now need to be rebuilt from critically low levels.

Speaker #3: This would require a call on additional and restoration of production, and that additional production also calls on access to reserves. We had already highlighted before that the level of investment has been insufficient from many in the industry and needs to be addressed.

Amin Nasser: This would require call on additional and restriction of production, that additional production also calls on access to reserves, where we had already highlighted before that the level of investment has been insufficient from many in the industry and needs to be addressed. We have talked about the advantage of taking a long-term view. This has been demonstrated most visibly in the flexibility built into our present operations. It's also visible in the duration of our reserves, maintained consistently and at a low cost, which gives the reassurance in the long term, which we believe others find it difficult to match. This is also a key part of our position as a leading global energy partner. Moving to the macro environment and market dynamics, we see some clear themes.

Speaker #3: We have talked about the advantage of taking a long-term view. This has been demonstrated most visibly in the flexibility built into our present operations.

Speaker #3: It is also visible in the duration of our reserves, maintained consistently and at a low cost, which gives reassurance in the long term—something we believe others find difficult to match.

Speaker #3: This is also a key part of our position as a leading global energy partner. Moving to the macro environment and market dynamics, we see some clear themes.

Speaker #3: Global oil demand has remained resilient as the supply shock was masked by an estimated 9 million barrels per day of strategic petroleum reserves and commercial inventory withdrawals, and around 2 million barrels per day in demand management.

Amin Nasser: Global oil demand has remained resilient as the supply shock was masked by an estimated 9 million barrels per day of strategic petroleum reserves and commercial inventory withdrawals, and around 2 million barrels per day in demand management. The unprecedented liquid supply loss has continued into Q2, and the world lost over 2.6 billion barrels of oil that was distant to a number of critical industries such as food, semiconductors, mobility, and petrochemicals. This has been partially offset by alternative flow bypassing Hormuz, the release of strategic petroleum reserves by government, and the utilization of Aramco's East-West Pipeline, which resulted in reducing the net supply loss to currently around 1.8 billion barrels. The key elements of this are, first, IEA Emergency Release program of 426 million barrels is coming to an end in August. With it, the 2 million barrels per day cushion will likely come off the market.

Speaker #3: The unprecedented liquid supply loss has continued into Q2, and the world lost over 2.6 billion barrels of oil that was destined to a number of critical industries such as food, semiconductors, mobility, and petrochemicals.

Speaker #3: This has been partially offset by alternative flow bypassing Hormuz, the release of strategic petroleum reserves by governments, and the utilization of Aramco's East-West Pipeline.

Speaker #3: This resulted in reducing the net supply loss to currently around 1.8 billion barrels. The key elements of this are, first, the IAEA emergency release program of 426 million barrels is coming to an end in August, and with it, a 2 million barrels per day cushion will likely come off the market.

Speaker #3: Second, after utilizing oil on water and SBR volumes, the world tapped into an estimated 600 million barrels, reflecting 6.5 million barrels per day between May and July, of commercial inventories.

Amin Nasser: Second, after utilizing oil on water and SPR volumes, the world tapped into an estimated 600 million barrels, reflecting 6.5 million barrels per day between May and July of commercial inventories, the only remaining buffer in the system today. Third, within Asia, crude oil imports were reduced by around six million barrels per day through a combination of SPR release, drawdown from commercial refined product inventories, and demand management. The East-West Pipeline has enabled Aramco to mitigate the impact of the disruption much more than the IEA coordinated strategic reserve release. All in all, significant drawdowns of commercial inventories have helped, but not met end user demand. The aggregate inventory level globally are not a proper reflection of the current physical market tightness. One needs to look into inventories by region, by product, and what is realistically available without pushing the inventory system into operational stress.

Speaker #3: The only remaining buffer in the system today. Third, within Asia, crude oil imports were reduced by around 6 million barrels per day through a combination of SPR release, drawdown from commercial refined product inventories, and demand management.

Speaker #3: The east-west pipeline has enabled Aramco to mitigate the impact of the disruption much more than the IAEA-coordinated strategic reserve release. All in all, significant drawdowns of commercial inventories have helped but have not yet impacted end-user demand.

Speaker #3: The aggregate inventory level globally is not a proper reflection of the current physical market tightness. One needs to look into inventories by region, by product, and what is realistically available without pushing the inventory system into operational stress.

Speaker #3: Third-party estimates indicate that only around 10% of these aggregate inventories are effectively accessible. The rest are locked up in pipeline fills, minimum tank levels, and other day-to-day operational constraints.

Amin Nasser: Third-party estimate only around 10% of these aggregate inventories to be effectively accessible. The rest locked up in pipeline fills, minimum tank levels, and other day-to-day operational constraints. In fact, we have seen several systems hit operational tank bottom, such as the US crude oil stocks at Cushing, which has been at such levels since mid-June. We see an apparent disconnect between future and physical markets as evident in the strong refining margins that reflect the market tightness. Margins are expected to stay exceptionally strong throughout H2 2026, supported by limited export availability from key regions like the Middle East, Russia, and Asia, resilient fuel demand, and persistently low product inventories. The refining system today, excluding stranded Arabian Gulf and Russian refineries that have been under attack, is stretched and is operating at near maximum utilization rates.

Speaker #3: In fact, we have seen several systems hit operational tank bottoms, such as US crude oil stocks at Cushing, which have been at such levels since mid-June.

Speaker #3: We see an apparent disconnect between the futures and physical markets, as evident in the strong refining margins that reflect market tightness. Margins are expected to remain exceptionally strong throughout the second half of 2026.

Speaker #3: Supported by limited export availability from key regions like the Middle East, Russia, and Asia, resilient fuels demand, and persistently low product inventories, the refining system today—excluding stranded Arabian Gulf and Russian refineries that have been under attack—is stretched and is operating at near maximum utilization rates.

Speaker #3: Currently, flows through the Strait of Hormuz are a tenth of the pre-conflict level. Energy and commodity supply chains will need months to return to pre-conflict traffic through the Strait of Hormuz, as these vessels reroute or avoid being idled.

Amin Nasser: Currently, flows through the Strait of Hormuz are a tenth of a pre-conflict level. Energy and commodity supply chains will need months to return to the pre-conflict traffic through the Strait of Hormuz as these vessels reroute or avoid being idle. Aramco's integrated export network provides access through the Strait of Hormuz and the Red Sea corridor, and from the Red Sea, both via Bab el-Mandeb and the Suez Canal. Let me be clear. Demand remains strong and has not been met by supply in H1 this year, but rather from commercial and strategic inventories. Global economy remains resilient with an estimated Q2 GDP growth of 2.3% and is expected to strengthen toward the end of the year and into 2027. Demand in H2 the year is expected to be around two million barrels per day higher than H1.

Speaker #3: Aramco's integrated export network provides access through the Strait of Hormuz and the Red Sea corridor, and from the Red Sea both via Bab-el-Mandeb and the Suez Canal.

Speaker #3: It may be clear demand remains strong and has not been met by supply in the first half of this year, but rather by drawing from commercial and strategic inventories.

Speaker #3: The global economy remains resilient, with an estimated second quarter GDP growth of 2.3%, and is expected to strengthen toward the end of the year and into 2027.

Speaker #3: Demand in the second half of the year is expected to be around 2 million barrels per day higher than in the first half. Restoring commercial inventories and strategic reserves to pre-conflict levels will materially add to calls on crude oil throughout 2027 and likely beyond.

Amin Nasser: Restoring commercial inventories and strategic reserves to pre-COVID levels will materially add to calls on crude oil throughout 2027 and likely beyond. To put this into context, if the Strait of Hormuz was to open today, it would take up to 18 months at an average rate of 2.1 million barrels per day to replenish depleted inventories on top of demand. Since the start of the conflict over five months ago, our response has been both rapid and focused as we have taken many business continuity and strategic decisions to navigate the challenges. As we outlined in May, we have built a high degree of flexibility in our assets, which gives us optionality. We continue to utilize the East-West Pipeline to steer crude flows across the network and maximize throughput and export from our West Coast refineries and terminals to capture higher margins.

Speaker #3: To put this into context, if the Strait of Hormuz were to open today, it would take up to 18 months at an average rate of 2.1 million barrels per day to replenish depleted inventories, on top of demand.

Speaker #3: Since the start of the conflict, over five months ago, our response has been both rapid and focused, as we have taken many business continuity and strategic decisions to navigate the challenges.

Speaker #3: As we outlined in May, we have built a high degree of flexibility into our assets, which gives us optionality. We continue to utilize the east-west pipeline for pure crude flows across the network.

Speaker #3: And maximized throughput and export from our West Coast refineries and terminals to capture higher margins. To ensure our supply route resilience, we fully deployed our transportation fleet across land and sea.

Amin Nasser: To ensure our supply route resilience, we fully deployed our transportation fleet across land and sea, and we optimized vessel scheduling by sharply reducing turnaround times, which resulted in a 20% increase in loading capacity at our terminals and a significant improvement in export capabilities. We capitalized on our international storage capability across Asia, Europe, and the Middle East. In Kingdom, multiple new hauling routes were activated and more than 3,000 trucks were utilized to maintain the refined products' local supply. Our unmatched growth and resilience is affirmed by our customers. This trust is because they know they can count on us no matter how challenging the circumstances. Our ability to restore assets and resume operation in a safe, optimized state was driven by both our dedicated teams and our strategic supply chain planning. Notably, in H1, more than 90% of materials were locally sourced for asset restoration.

Speaker #3: And we optimize vessel scheduling by sharply reducing turnaround times, which resulted in a 20% increase in loading capacity at our terminals and a significant improvement in export capabilities.

Speaker #3: We capitalized on our international storage capability across Asia, Europe, and the Middle East. In-Kingdom, multiple new hauling routes were activated and more than 3,000 trucks were utilized to maintain the refined products' local supply.

Speaker #3: Our unmatched, proven resilience is affirmed by our customers. This trust is because they know they can count on us, no matter how challenging the circumstances.

Speaker #3: Our ability to restore assets and resume operation in a safe, optimized state was driven by both our dedicated teams and our strategic supply chain planning.

Speaker #3: Notably, in the first half, more than 90% of materials were locally sourced for asset restoration. Without this, lead times would typically take months or up to a year.

Amin Nasser: Without this, lead times would typically take months or up to a year. We created a network that allowed us to resume operations faster than ever before and even six times faster than industry peers, as verified by third-party consultants. With our intense focus on maintaining high reliability, enhancing flexibility, and optimizing delivery, we were able to continue expanding new crude sales outlets even during the conflict. Our actions in navigating challenges demonstrated our exceptional resilience and operational agility, further reinforcing our role as a leading global energy partner in today's volatile energy landscape. As we look ahead to the rest of 2026 and beyond, we remain concerned that the continued disruption via the Strait of Hormuz and the threats to shipping via the Bab el-Mandeb Strait could have a significant long-term impact on the world economy.

Speaker #3: We created a network that allowed us to resume operations faster than ever before—and even six times faster than industry peers, as verified by a third-party consultant.

Speaker #3: With our intense focus on maintaining high reliability, enhancing flexibility, and optimizing delivery, we were able to continue expanding new crude sales outlets even during the conflict.

Speaker #3: Our actions in navigating challenges demonstrated our exceptional resilience and operational agility, further reinforcing our role as a leading global energy partner in today's volatile energy landscape.

Speaker #3: As we look ahead to the rest of 2026 and beyond, we remain concerned that the continued disruption via the Strait of Hormuz and the threats to shipping via the Bab-el-Mandeb Strait could have a significant long-term impact on the world economy.

Speaker #3: With that, let me now hand over to Ziad to provide more details on the strengths of our first half and second quarter jobs.

Amin Nasser: With that, let me now hand over to Ziad to provide more details on the trends for our H1 and Q2 results.

Speaker #1: Thank you, Amin, and welcome everyone. Amin has talked about operational resilience and how Aramco has built it over decades. This operational resilience clearly translates into financial resilience, driving robust underlying performance under very demanding conditions.

Ziad Al-Murshed: Thank you, Amin, and welcome everyone. Amin has talked about operational resilience and how Aramco has built it over decades. This operational resilience clearly translates into financial resilience, driving robust underlying performance under very demanding conditions. We delivered industry-leading results in Q2 with adjusted net income of $33.4 billion, stable versus last quarter, despite the challenges impacting the full quarter. This is 33% higher compared to last year and driven by increases in both upstream and downstream. Upstream adjusted EBIT was up 14% year-on-year in Q2 at $50.9 billion. As we utilized the flexibility that we have purposely built into our assets to optimize supply and crude oil grades delivered through our network to capture price upside. Downstream also delivered excellent results with adjusted EBIT in Q2 up to nearly twice the level a year ago at $6.2 billion.

Speaker #1: We delivered industry-leading results in Q2, with adjusted net income of $33.4 billion, stable versus last quarter despite the challenges impacting the full quarter. This is 33% higher compared to last year and driven by increases in both upstream and downstream.

Speaker #1: Upstream adjusted EBIT was up 14% year on year in Q2 at $50.9 billion, as we utilized the flexibility that we have purposely built into our assets to optimize supply and crude oil grades delivered through our network to capture price upside.

Speaker #1: Downstream also delivered excellent results, with adjusted EBIT in Q2 nearly twice the level of a year ago, at $6.2 billion. In fact, for the first half, overall adjusted EBIT for downstream was up 144% year on year, to $11.7 billion.

Ziad Al-Murshed: In fact, for the H1, overall adjusted EBIT for Downstream was up 144% year-on-year to $11.7 billion. This strong financial performance is further evidence that our integrated operating model performs robustly across volatile and challenging conditions. Looking into Q2 in more detail, our results highlight how our operational advantage and flexibility translates into exceptional returns. We delivered 12-month rolling GROACI of 22.1%. This is higher than both last quarter and last year, even as we experienced the most severe disruption we have ever seen. In Upstream, realized prices increased 62% year-on-year to $108.1 per barrel, helped by our success in achieving a record premium of more than $10 per barrel over Brent.

Speaker #1: This strong financial performance is further evidence that our integrated operating model performs robustly across volatile and challenging conditions. Looking into Q2 in more detail, our results highlight how our operational advantage and flexibility translate into exceptional returns.

Speaker #1: We delivered a 12-month rolling grow at a rate of 22.1%. This is higher than both last quarter and last year, even as we experienced the most severe disruption we have ever seen.

Speaker #1: In Upstream, realized prices increased 62% year-on-year to $108.1 per barrel, helped by our success in achieving a record premium of more than $10 per barrel over Brent.

Speaker #1: This enabled us to fully compensate for the effects of a lower production volume at 9.5 million barrels per day of oil equivalent, and to deliver strong adjusted EBIT versus last quarter, despite the challenges over the full quarter.

Ziad Al-Murshed: This enabled us to fully compensate for the effects of a lower production volume at 9.5 million barrels per day of oil equivalent, and to deliver strong adjusted EBIT versus last quarter, despite the challenges over the full quarter. In Downstream, adjusted EBIT was $6.2 billion, demonstrating the benefits of our integrated operating and trading operations, the geographical diversification of our assets, and our continuous focus on asset reliability across the portfolio, which together enabled us to withstand disruptions and capture the higher margins. Q2 free cash flow, excluding working capital movements, was $25.9 billion, up 42% year-on-year as a result of higher prices. The working capital movement is mainly due to a specific effect in Q2 relating to the normal price equalization mechanism with the government. Let me take a minute to explain this mechanism.

Speaker #1: In Downstream, adjusted EBIT was $6.2 billion, demonstrating the benefits of our integrated operating and trading operations, the geographical diversification of our assets, and our continuous focus on asset reliability across the portfolio, which together enabled us to withstand disruptions and capture the higher margins.

Speaker #1: Q2 free cash flow excluding working capital movements was $25.9 billion, up 42% year on year, as a result of higher prices. The working capital movement is mainly due to a specific effect in Q2 relating to the normal price equalization mechanism with the government.

Speaker #1: Let me take a minute to explain this mechanism. For local sales, we are compensated for differences between domestic and international prices, but with a time lag.

Ziad Al-Murshed: For local sales, we are compensated for differences between domestic and international prices, but with a time lag. The significant oil price increase in Q2 led to higher receivables from this compensation mechanism. However, this has now already started reversing and will be fully settled in Q3. This is just a timing issue. Overall, the effect of this compensation mechanism accounts for the majority of the working capital increase in Q2, which is why we are focusing on free cash flow excluding working capital for Q2. Again, this was $25.9 billion, up 42% year-on-year. Even with this effect in Q2, our gearing at just 6.2% is exceptional and helps provide the resilience and flexibility to match the quality of our operations.

Speaker #1: The significant oil price increase in Q2 led to higher receivables from this compensation mechanism. However, this has already started reversing and will be fully settled in Q3.

Speaker #1: So, this is just a timing issue. Overall, the effect of this compensation mechanism accounts for the majority of the working capital increase in Q2, which is why we are focusing on free cash flow excluding working capital for Q2.

Speaker #1: Again, this was $25.9 billion, up 42% year on year. Even with this effect in Q2, our gearing at just 6.2% is exceptional and helps provide the resilience and flexibility to match the quality of our operations.

Speaker #1: Now, looking at our performance in the first half as a whole, we see a significant increase in adjusted net income compared to a year ago, which reflects the scale and resilience of our business.

Ziad Al-Murshed: Now, looking at our performance of the H1 as a whole, we see a significant increase in adjusted net income compared to a year ago, which reflects the scale and resilience of our business and our ability to successfully overcome challenges. Both Upstream and Downstream demonstrated strong year-on-year growth, and our operating cash flow continued to be strong at $56.2 billion. Free cash flow, excluding the working capital build I explained earlier, was $60.3 billion, up more than 50% year-on-year, reflecting the strong underlying cash generation capacity of the business. Gearing in the H1 was 0.3 percentage points lower than that in the H1 2025. This strength in our balance sheet is the first advantage we are building upon.

Speaker #1: And our ability to successfully overcome challenges. Both upstream and downstream demonstrated strong year-on-year growth, and our operating cash flow continued to be strong at $56.2 billion.

Speaker #1: Free cash flow, excluding the working capital build I explained earlier, was $60.3 billion—up more than 50% year-on-year—reflecting the strong underlying cash generation capacity of the business.

Speaker #1: Gearing in the first half was 0.3 percentage points lower than in the first half of 2025. This strength in our balance sheet is the first advantage we are building upon.

Speaker #1: It is marked by our unmatched cash position at more than $60 billion at the end of Q2, our high credit rating with the lowest gearing in the sector, and our selective use of bonds, sukuk, commercial paper, and innovative financing solutions such as general corporate use of funding from export credit agencies, to both diversify and expand our available funding sources whenever required.

Ziad Al-Murshed: It is marked by our unmatched cash position at more than SAR 60 billion at the end of Q2, our high credit rating with the lowest gearing in the sector, and our selective use of bonds, Sukuk, commercial paper, and innovative financing solutions such as general corporate use of funding from export credit agencies to both diversify and expand our available funding sources whenever required. Our unmatched financial position gives us confidence to invest through cycles in unique opportunities that are mainly available only to us. Despite such financial strength, we maintain our commitment to capital discipline. In H1, capital investments totaled SAR 25.1 billion, and we maintain our guidance of SAR 50 to 55 billion for 2026, which excludes our potential investment in Humane.

Speaker #1: Our unmatched financial position gives us confidence to invest through cycles in unique opportunities that are mainly available only to us. Despite such financial strength, we maintain our commitment to capital discipline.

Speaker #1: In the first half of the year, capital investments totaled $25.1 billion, and we maintain our guidance of $50 to $55 billion for 2026, which excludes our potential investment in Humane.

Speaker #1: Taken together, this reinforces our objective of maximizing shareholder value, where our sustainable and progressive-based dividend has grown 17% since 2022, and our $2 to $3 billion share buyback program is progressing, with our performance-linked dividend mechanism remaining in place to share upside.

Ziad Al-Murshed: Taken together, this reinforces our objective of maximizing shareholder value, where our sustainable and progressive base dividend has grown 17% since 2022, and our SAR 2 to 3 billion share buyback program is progressing, with our performance-linked dividend mechanism remaining in place to share upside. For Q2, the board has announced a base dividend of SAR 82.1 billion, equivalent to $21.9 billion, up 3.5% year-on-year. This will be paid on 27 August to shareholders who own our shares on the eligibility date of 19 August. Before we move to Q&A, let me leave you with three key takeaways. First, with our maximum sustainable capacity of 12 million barrels per day, we are well-positioned to capture value from the higher demand outlook. Recent disruptions have underlined one critical fact: energy security is paramount, and global inventory needs to be rebuilt.

Speaker #1: For the second quarter, the Board has announced a base dividend of 82.1 billion reals, equivalent to $21.9 billion, up 3.5% year-on-year. This will be paid on the 27th of August to shareholders who own our shares on the eligibility date of the 19th of August.

Speaker #1: Before we move to Q&A, let me leave you with three key takeaways. First, with our maximum sustainable capacity of 12 million barrels per day, we are well positioned to capture value from the higher demand outlook.

Speaker #1: Recent disruptions have underlined one critical fact: energy security is paramount, and global inventory needs to be rebuilt. Second, we have de-risked our business over nearly four decades through a variety of strategic positions, leading to an unmatched asset portfolio.

Ziad Al-Murshed: Second, we have de-risked our business over nearly four decades through a variety of strategic positions, leading to an unmatched asset portfolio. We lead in upstream volume, we have the agility to ramp up production fast and have significant downstream optionality with multiple supply points, and our reserve position is not matched by any peer. These advantages further enhance our capability to capture opportunities. Third, our financials underpin it all with superior returns, the lowest gearing in the sector, a visible trajectory of cash flow growth, and world-class distributions. This is the Aramco proposition, delivering value for our customers and for our investors, even under difficult market conditions. With that, thank you for your attention. Amin, Peter, and I are now pleased to take your questions.

Speaker #1: We lead in upstream volume, and we have the agility to ramp up production fast. We have significant downstream optionality, with multiple supply points, and our reserve position is not matched by any peer.

Speaker #1: These advantages further enhance our capability to capture opportunities. And third, our financials underpin it all—with superior returns, the lowest gearing in the sector, a visible trajectory of cash flow growth, and world-class distributions.

Speaker #1: This is the Aramco proposition: delivering value for our customers and for our investors even under difficult market conditions. With that, thank you for your attention. Amin, Peter, and I are now pleased to take your questions.

Speaker #2: To ask a question, please press star followed by one on your telephone keypad. To withdraw your question, please press star followed by two. When asking a question, please ensure you are unmuted locally.

Operator: To ask a question, please press star followed by one on your telephone keypad. To withdraw your question, please press star followed by two. When asking a question, please ensure you are unmuted locally. I shall now hand back over to Mr. Hutton.

Speaker #2: I shall now hand back over to Mr. Hutton.

Speaker #3: Thank you very much. First of all, the questions come from Iyad Ghulam of SNB Capital. Go ahead, Iyad.

Peter Hutton: Thank you very much. First of all, questions come from Iyad Ghulam of SNB Capital. Go ahead, Iyad.

Speaker #4: Assalamualaikum. First of all, congratulations on the strong and resilient set of results during such challenging times. I have two questions. One is about, given the major disruption in oil supplies and drawdowns from global strategic reserves, how should we think about the supply and demand dynamics in the medium term?

Iyad Ghulam: As-salamu alaykum. First of all, congratulations on the strong and resilient set of results during such challenging times. I have two questions. One is about, given the major disruption in oil supplies and drawdowns from global strategic reserves, how should we think about the supply and demand dynamics in the medium term and if the situation continues? Also, would supply go back to normal quickly if things normalize? The second question is about the Bab el-Mandeb. I understand the situation is very unpredictable nowadays, but how Aramco is dealing with the issue currently?

Speaker #4: And if the situation continues, would supply go back to normal quickly if things normalize? The second question is about the Bab el-Mandeb.

Speaker #4: I understand the situation is very unpredictable nowadays, but how is Aramco dealing with the issue currently?

Speaker #3: Thank you, Iyad. You know, supply and demand going forward—it all depends. We said earlier that demand is resilient. It was masked because of the interruptions by the additional supply of around 9 million barrels that came from the inventories and SPRs.

Amin Nasser: Thank you, Iyad. Supply-demand fundamentals going forward, this will all depend. We said earlier that demand is resilient. It was masked because of the interruptions by the additional supply of around 9 million barrels that came from the inventories and SPRs, the IEA, and what came from Asia in terms of commercial inventories. We strongly believe that because of the need to build additional inventory to replenish the inventories that was consumed during the last couple of months, you are looking at an additional of 2.1 million barrels per day of additional demand just to fill the inventories and to build it to a level that is, I would consider insufficient at that time. If you look at our inventory before the crisis, which was at the low end of the five-year average. This is before the crisis.

Speaker #3: The IEA and what came from Asia, and in terms of commercial inventories, we strongly believe that because of the need to build additional inventory to replenish the inventories that were consumed during the last couple of months, you are looking at an additional 2.1 million barrels per day of additional demand just to fill the inventories and to build it to a level that I would consider insufficient at that time. Because if you look at our inventory before the crisis, it was at the low end of the five-year average.

Speaker #3: This is before the crisis. So we enter the crisis, or this conflict, with low inventory, and we need approximately—if everything goes back to normal—18 months of additional demand beyond normal demand of 2.1 million barrels just to refill the inventory.

Amin Nasser: We enter the crisis or this conflict with a low inventory, and we need approximately, if everything goes back to normal, 18 months of additional demand beyond normal demand of 2.1 million barrels just to refill the inventory. Add to that, all governments now, because we are talking with different governments around the world, everybody is trying to add additional storage. They are going to build because of the need for energy security over the long term and to cater for such disruptions. You will see a significant build of additional inventory. This is the 2.1 that we are talking about is over the next 18 months of additional demand, is just to replenish depleted inventories, not to cater for the additional storage facilities that we are considering, because of these disruptions and that everybody is now looking at what additional inventories.

Speaker #3: Add to that, all governments now—because we're talking with different governments around the world—everybody is trying to add additional storage. So they are going to build, because of the need for energy security over the long term, and to cater for such disruptions, you will see a significant build of additional inventory.

Speaker #3: So, this is the 2.1 that you are talking about—it is over the next 18 months of additional demand, just to replenish depleted inventories, not to cater for the additional storage facilities that we are considering because of these disruptions. And now everybody is looking at what additional inventories are needed, because we found certain places with very minimal inventory, some of them in the neighborhood of a million, certain countries with 2, 3, 5 million barrels of inventory, which is not adequate to cater for such disruptions.

Amin Nasser: We found certain places with very minimal inventory. Some of them in the neighborhood of million, certain countries, 2, 3, 5 million barrels of inventory, which is not adequate to cater for such disruptions. With regard to Bab el-Mandeb, as we said, we have managed some risks to the route very effectively for some time. It is always under our consideration. The government is tackling this risk and has never limited our option to go through Bab el-Mandeb. We have optionality, as you know, through multiple access routes and alternative pathways to the Mediterranean through SUMED pipeline and the Suez Canal. In addition, we have well-established contingency plan that provide us with a lot of flexibility and resilience to adapt as conditions evolve and enable us to continue to export around 5 million barrels.

Speaker #3: With regard to Bab el-Mandeb, as we said, we have managed some risks to reach zero very effectively for some time. It is always under our consideration. The government is tackling this risk and has never limited our option to go through Bab el-Mandeb.

Speaker #3: We have optionality, as you know, through multiple access routes and alternative pathways to the Mediterranean through the Sumud pipeline and the Suez Canal. In addition, we will establish contingency plans that provide us with a lot of flexibility and resilience to adapt as conditions evolve and enable us to continue to export around 5 million barrels.

Speaker #3: Bear in mind that any reduction in shipping rounds will create serious problems for the world, affecting not only the oil and gas sector, but many other areas of the global economy such as, as I highlighted earlier, agriculture, fertilizer, mobilities, semiconductors. So there is no impact on our operation on the West Coast, and as I said, we have the optionality and we continue to export 5 million barrels with that optionality.

Amin Nasser: Bear in mind that any reduction in shipping routes will create serious problem to the world, affecting not only the oil and gas sector, but many other area of global economy such as they highlighted earlier, agriculture, fertilizer, mobilities, semiconductor. There is no impact on our operation on the West Coast. As I said, we have the optionality, and we continue to export 5 million barrels with that optionality.

Peter Hutton: I guess there was one, sort of, Iyad managed to get a third question in there, which was how quickly could we restore to pre-conflict levels.

Speaker #4: Just there was one sort of Iyad managed to get a third question in there which was how quickly could we restore to pre-conflict levels our levels of.

Speaker #3: Oh, you know, we can return production to pre-conflict levels within days. To go to maximum sustained capacity, which is 12 million barrels per day, we can bring it within three weeks if we are asked.

Amin Nasser: Production to pre-conflict level, within days. To go to maximum sustained capacity, which is 12 million barrels per day, we can bring it within three weeks if we are asked.

Speaker #4: Thanks, Iyad. Next question is from Berat Walkattaria of RBC. Go ahead, Berat.

Peter Hutton: Thanks, Iyad. Next question is from Biraj Borkhataria of RBC. Go ahead, Biraj.

Speaker #5: Hi there. Thanks for taking my question and, again, obviously it's an extremely challenging time for the operational people, so congratulations to them and congratulations on the resilience numbers.

Biraj Borkhataria: Hi there. Thanks for taking my question. Again, obviously it's extremely challenging time for the operational people, so congratulations to them and congratulations on the resilient set of numbers. First question, in your CapEx budget for the year, you usually include a fairly sizable element for inorganic acquisitions. I was just wondering, given the current environment we're seeing with macro assumptions moving all over the place, is it fair to say we should expect you to slow down a little bit and be more selective on this front because it's hard to deal with the assumptions moving around, or are you still seeing things you can execute on? The second question is just on your comment, on the rebuild of storage.

Speaker #5: Just the first question: in your CAPEX budget for the year, you usually include a fairly sizable element for inorganic acquisitions. I was just wondering, given the current environment we're seeing with macro assumptions moving all over the place, is it fair to say we should expect you to slow down a little bit and be more selective on this front? Because I guess it's hard to deal with the assumptions moving around. Or are you still seeing things you can execute on?

Speaker #5: And then the second question is just on your comment, I mean, on the rebuild of storage. Just—anything you can highlight from your conversation with customers? Because the pace of rebuild of these storages, both crude and products, is going to determine how strong oil demand is. So any insights you can give there would be helpful.

Biraj Borkhataria: Just anything you can highlight from your conversations with customers, because obviously the pace of rebuild of these storage, both crude and products, is going to determine how strong oil demand is. Any insights you can give there would be helpful. Thank you.

Speaker #5: Thank you.

Speaker #3: Thank you, Berat. I'll take the second part of your question. Iyad will talk about the CAPEX. With regard to the re— I mean, additional storage will require significant rebuild, and it will take time to go beyond the existing inventory that was available prior to the conflict.

Amin Nasser: Thank you, Biraj. I'll take the second part of your question. Ziad will talk about the CapEx. With regard to the additional storage will require a significant rebuild, and it will take time to go beyond the existing inventory that was available prior to the conflict. Everybody we're talking to now is looking at building additional storage facilities to cater for similar disruptions in the long term, because energy security is becoming a priority now when you talk about energy. As such, it will take time to build these additional storage beyond filling the existing storage facilities that were depleted. That type of project is being handled by commercial entities, governments, and we are in discussion to see what's available and how long it will take to rebuild these additional facilities and how can we participate in terms of availing some of our crude for storage. Ziad.

Speaker #3: Everybody we're talking to now is looking at building additional storage facilities to cater for similar disruptions in the long term, because energy security is becoming a priority now when you talk about energy.

Speaker #3: And as such, it will take time to build these additional storage facilities beyond filling the existing storage facilities that were depleted. But that type of project is being handled by, you know, commercial entities, governments, and we are in discussion to see what's available and how long it will take to rebuild these additional facilities, and how we can participate in terms of availing some of our crude for storage.

Speaker #4: Yeah, Berat, on your question on external investments: we were always fiscally disciplined on these, so these are proceeding, see, because we're maintaining our capital guidance still at $50 to $55 billion. There's a small amount in there; we're maintaining that. But keep in mind we also guided that our investment in Humane is not part of this guidance because of ongoing discussions.

Ziad Al-Murshed: Yeah. Biraj, on your question on external investments. We were always fiscally disciplined on these, so these are proceeding, as is the amount that you see, because we're maintaining our capital guidance still at SAR 50 to 55 billion. There's a small amount in there. We're maintaining that. Keep in mind, we also guided that our investment in Humane is not part of this guidance because of ongoing discussions. The answer to your question is we're sticking to the plan, but we're maintaining the guidance at SAR 50 to 55 billion.

Speaker #4: And so the answer to your question is we're sticking to the plan, but we're maintaining the guidance at $50 to $55 billion. Thank you, Berat.

Peter Hutton: Thank you, Biraj. Next question is from Henri Patricot of UBS. Henri, over to you.

Speaker #4: Next question is from Henri Patrickou of UBS. Henri, over to you.

Speaker #6: Yes thank you Peter and everyone thank you for the update. Two questions please from my side. Just the first one on the near term production outlook there's a lot of volatility but I was hoping you can perhaps share some comment on this you know 9.5 million barrel per day of production that we saw in the in the second quarter is that the level that you would be able to to maintain in the third quarter assuming that the straight remains mostly close as it is at the moment although there's you know some room for for improvement and then thinking a bit later on I mean you highlighted indeed the significant flexibility adaptability that that was shown in the past few months and in particular the benefit of the east west pipeline can you share more details on on where you are in terms of perhaps expanding that that pipeline doesn't need more attention on that thank you.

Henri Patricot: Yes. Thank you, Peter, and everyone. Thank you for the update. Two questions, please, from my side. Just the first one on the near-term production outlook. Obviously, a lot of volatility, but I was hoping you can perhaps share some comment on this 9.5 million barrels per day of production that we saw in Q2. Is that the level that you would be able to maintain in Q3, assuming that the Strait remains mostly closed as it is at the moment? Or there is some room for improvement. Thinking a bit later on, you highlighted indeed the significant flexibility and adaptability that has shown in the past few months, and in particular, the benefit of the East-West Pipeline. Can you share more details on where you are in terms of perhaps expanding that pipeline? There was more attention on that. Thank you.

Speaker #3: Thank you, Henry. You know, the number I’m going to give you, highlighted, is this: total hydrocarbon, the liquid for total liquid production for the second quarter is 7.6 million barrels per day.

Amin Nasser: Thank you. The 9.5 you highlighted is this total hydrocarbon, the liquid for total liquid production in Q2 of 7.6 barrels per day. Majority of that is crude. With regard to the East-West and our optionality, as I said, always people think that we have two routes, which is Hormuz and Red Sea through Bab el-Mandeb. We do have three routes actually through the Mediterranean utilizing the SUMED pipeline and the Suez Canal in terms of exporting our crude. We are looking at actively increasing optionality right now to expand on our adding flexibility. This is currently under execution. Our engineering team is looking at how can we not only expand what we have, but at the same time identifying other routes that we can capitalize on. This is all under work.

Speaker #3: The majority of that is crude with regard to the east-west, and our optionality—as I said, we do have the, you know, always people think that we have two routes, which is Hormuz and the Red Sea through Bab-el-Mandeb, but we do have three routes, actually: through the Mediterranean, utilizing the SUMED pipeline and the Suez Canal. In terms of exporting our crude, we are actively looking at increasing optionality right now to expand on or add flexibility. This is currently under execution. You know, our engineering team is looking at how we can not only expand what we have, but at the same time identify other routes that we can capitalize on.

Speaker #3: This is all under work, and with regard to production, as I said, your question is—we can, depending on the situation. We are currently, through the East-West, limited to the pipeline capacity; however, it depends on what happens in Hormuz. We remain ready if the situation normalizes in the Strait of Hormuz to bring production to pre-conflict levels. As I said, within days, we can also bring our full maximum sustained capacity of 12 million within three weeks, if we are asked to do that.

Amin Nasser: With regard to production, as I said, your question is we can, depending on the situation, we are currently through the East-West Pipeline limited to the pipeline capacity. It depends on what's happening in Hormuz. We remain ready if the situation normalizes in the Strait of Hormuz, to bring production to pre-conflict levels, as I said, within days. We can also bring our full Maximum Sustainable Capacity of 12 million within three weeks if we are asked to do that. This is intact, but it all depends on things normalizing in the Strait of Hormuz.

Speaker #3: So, this is intact, but it all depends on things normalizing in the Strait of Hormuz.

Speaker #4: Thank you, Henri. And the next question is from Matt Lofting at JP Morgan. Matt.

Peter Hutton: Thank you, Henri. The next question is from Matt Lofting at J.P. Morgan. Matt?

Speaker #7: Hello, thank you for taking the questions, and congratulations on the strength of delivery in the context of the regional backdrop. Aramco has strong cash flow growth targets to 2030.

Matt Lofting: Hello. Thank you for taking the questions, congratulations on the strength of delivery in context of the regional backdrop. Aramco has strong cash flow growth targets to 2030. I thought that the updates that you provided on some of the big project increments, including the progress at Zuluf in the H1 of the year was impressive given the circumstances. As things sort of stand today and based on what you currently see, do you believe that the 2030 cash flow targets remain achievable on an underlying basis, or are there specific areas whereby if the regional circumstances were to persist, that there probably starts to require some adjustment? Thank you.

Speaker #7: I thought that the updates you provided on some of the project increments, including the progress of Zulu in the first half of the year, were impressive.

Speaker #7: Given the circumstances as things sort of stand today and sort of based on what what you currently see do you believe that the sort of the 2030 cash flow targets remain achievable on an underlying basis or are there sort of specific areas whereby if the regional circumstances were to persist that there probably starts to require some adjustment.

Speaker #7: Thank you.

Speaker #3: Thank you, Matt. So, we're still seeing the gas generation growth by 2030 being the same, because 2030 is quite—I mean, a number of years out.

Ziad Al-Murshed: Thank you, Matt. We're still seeing the cash generation growth by 2030 being the same, because 2030 is quite a number of years out. This is coming from expansions and projects that we are executing mainly in gas and in the downstream, as well as a lot of transformation work, which is a combination of top line and cost. We're expecting same going forward for 2030. These are associated with growth in gas production mainly, as well as downstream, both growth in top line and which is driven by volume and reduction in cost as a result of the transformation.

Speaker #3: This is coming from expansions and projects that we are executing mainly in gas and in the downstream, as well as a lot of transformation work.

Speaker #3: This is a combination of, you know, top line and cost, and so we're expecting the same going forward for 2030. These are associated with growth in gas production mainly, as well as downstream, both growth in top line—which is driven by volume—and reduction in cost as a result of the transformation.

Speaker #3: Add to that, Matt, you know we strongly believe the demand will be stronger going forward. I just highlighted the 2.1 million barrels needed just to refill heated inventories that were at their low end prior to the conflict.

Amin Nasser: Add to that, Matt, we strongly believe the demand will be stronger going forward. I highlighted the 2.1 million barrels just to refill heated inventories that were below in prior to the conflict. You need to add to the demand forecast, the additional storage facility that's being looked at right now to rebuild. That would take a couple of years to put these additional storage facilities online, and that would require additional demand or from just to refill the new additional storage facilities. Everybody is start thinking now about having a healthy SPR, strategic petroleum reserves in their countries.

Speaker #3: You need to add to the demand forecast the additional storage facility that's being looked at right now to rebuild. That will take a couple of years to put these additional storage facilities online, and that would require additional demand just to refill the new additional storage facilities.

Speaker #3: So, everybody is starting to think now about having healthy SPR—Strategic Petroleum Reserves—in their countries, where China did a good job, adding almost 1.2 billion barrels, based on estimates of strategic reserves. And I think other countries are looking at building these facilities, but it will take time. This is where you will see the healthy buildup and demand going forward.

Amin Nasser: China did a good job, I think almost 1.2 billion barrels is on estimate of strategic reserves. I think other countries are looking at building these facilities, it will take time, this is where you will see the healthy build-up in demand going forward.

Speaker #4: Thanks, Matt. Next question comes from Sashank Lanka at Bank of America. Go ahead, Sashank.

Peter Hutton: Thanks, Matt. Next question comes from Sashank Lanka at Bank of America. Go ahead, Shashank.

Speaker #6: Yes, thank you very much, Peter. Congratulations to the Aramco team on another resilient set of results. I have two questions. The first is just around the, you know, the option of going through the Sumed pipeline or the Suez Canal.

Sashank Lanka: Yes, thank you very much, Peter. Congratulations to the Aramco team on another resilient set of results. I have two questions. The first is just around the option of going through the SUMED Pipeline of the Suez Canal. How much additional time would this take versus going further south to the Bab el-Mandeb Strait? That's the first question. The second question is just on income tax. I did notice you had pretty low taxes this quarter. I think the implied tax rate is around 43%. Your general rate is around 49%, 50%. Just wondering what drove this and if this is something that can be sustained going forward. Thank you.

Speaker #6: How much additional time would this take versus going, you know, further south to the Bab-el-Mandeb Strait? That's the first question. Second question is just on income tax—I did notice you had pretty low taxes this quarter. I think the implied tax rate is around 43%.

Speaker #6: Your general rate is around 49–50%, so I was just wondering what drove this and if this is something that can be sustained going forward.

Speaker #6: Thank you.

Speaker #3: Thank you, Sashank. I'll take the first part of your question. The additional time to go through the Suez Canal and reroute back through the Cape of Good Hope to Asia will add approximately 20 to 25 days.

Amin Nasser: Thank you, Shashank. I'll take the first part of your question. The additional times to go through the Suez Canal and reroute back through the Cape of Good Hope to Asia will add approximately 20 to 25 days.

Speaker #4: Yeah, Sashank, on the tax rate, you're absolutely right. Actually, it's been dropping over the last two quarters. So, Q4 of last year was 56.1% as an effective tax rate.

Ziad Al-Murshed: Yeah. Shashank, on the tax rate, you're absolutely right. Actually, it's been dropping over the last two quarters. Q4 of last year was 56.1 as an effective tax rate. Q1, 45.1, and dropped to 42.9%. This is mainly driven by increased profitability in refining and gas, which are taxed at 20%, as opposed to the oil business being taxed at 50%. The mix of the profitability is coming from the lower tax bracket businesses, that's what drove the effective tax rate down to 42.9.

Speaker #4: Q1 was 45.1% and dropped to 42.9%. This is mainly driven by increased profitability in refining and gas, which are taxed at 20%, as opposed to the oil business being taxed at 50%.

Speaker #4: So, the mix of the profitability is coming from the lower tax bracket businesses, and so that's what drove the effective tax rate down to 42.9%.

Speaker #4: Thank you, Sashank. Next question is from Kim Poustier of HSBC. Kim, over to you.

Peter Hutton: Thank you, Shashank. Next question is from Kim Fustier of HSBC. Kim, over to you.

Speaker #5: Hi, good morning. Thank you for taking my questions. I had two, please. Firstly, could you talk about your ability to execute projects in the Kingdom, including Jafurah, Dammam, Zuluf, and how confident you are in managing to maintain the original execution timeline?

Kim Fustier: Hi. Good morning. Thank you for taking my questions. I had two, please. Firstly, could you talk about your ability to execute projects in Kingdom, including Jafurah, Manifa, and how confident you are in managing to maintain the original execution timeline? My second question is on asset status and integrity. Over the past couple of weeks, there have been reports of hits on some Aramco assets, including the Abqaiq oil processing plant, the Ras Tanura refinery, and the Yanbu Port. Are you able to give us an update on the status of these assets? Thank you.

Speaker #5: My second question is on asset status and integrity. Over the past couple of weeks, there have been reports of hits on some Aramco assets, including the Abqaiq oil processing plant, which is their refinery, and the Yanbu port.

Speaker #5: Are you able to give us an update on the status of these assets? Thank you.

Speaker #3: Thank you, Kim. With regard to our projects, they all remain on track and our strategies are unchanged. We have a very effective and diversified supply chain, and our In-Kingdom Total Value Add program has built almost 70% of the supply chain from within the Kingdom.

Amin Nasser: Thank you, Kim. With regard to our projects, they remain all on track and our strategies unchanged. We have a very effective and diversified supply chain and iktva, our in-Kingdom total value add program, builds almost 70% of the supply chain from within the Kingdom. If needed, we have the ability to import equipment and material through the west coast. Everything remains at this stage on track with regard to our projects. With regard to the assets' integrity, we don't really comment on matter related to military and security incidents. However, I want to assure you that our production is intact, our MSC is intact, our supply of products within the Kingdom is intact, and we did not have to go to any of our strategic reserve when it comes to products, which shows the health of our system in managing the current situation.

Speaker #3: And, if needed, we have the ability to import equipment and material through the West Coast. So everything remains, at this stage, on track with regard to our projects.

Speaker #3: With regard to the assets integrity, as we have said, we don't really comment on matters related to military and security incidents. However, I want to assure you that our production is intact, our embassy is intact, our supply of products within the Kingdom is intact, and we did not have to go to any of our strategic reserve when it comes to products, which shows the health of our system in managing the current situation. The most important thing to know is that we leverage multiple redundancies and infrastructure capability to overcome the situation, and the restoration capability that exists within Saudi Aramco is six times faster than the industry peer, as compared by third party.

Amin Nasser: The most important things is that we live in multiple redundancy and infrastructure capability to overcome the situation and the restoration capability that exists within Saudi Aramco is six times faster than the industry peer, as confirmed by third party. We are able, whenever we have an attack or an incident, to isolate that facility or put it back on stream quick enough without impacting our operation. We have been successful doing that. Don't forget that we've been attacked since 2019, and we have a proven track record in maintaining. If we are today asked to bring our production to pre-conflict level, it will only take us days. If we are asked today to bring our production to maximum sustained capacity, if we are asked, we can bring it within three weeks. Nothing's changed.

Speaker #3: So we are able, whenever we have an attack or an incident, to isolate that facility or put it back on stream quickly enough without impacting our operation, and we have been successful doing that.

Speaker #3: Don't forget that we've been attacked since 2019, and we have a proven track record in maintaining. So, if we are today asked to bring our production to pre-conflict levels, it will only take us days.

Speaker #3: And if we are asked today to bring our production to maximum sustained capacity, if we are asked, we can bring it within three weeks.

Speaker #3: Nothing changed.

Speaker #4: Thanks, Kim. Next question is from Alistair Simon at Citi. Go ahead, Al.

Peter Hutton: Thanks, Kim. Next question is from Alastair Syme at Citi. Go ahead, Al.

Speaker #7: Yeah, thanks, Peter. If I could firstly echo the comments that were made about the ability of the organization to work as it has in this environment.

Alastair Syme: Yeah. Thanks, Peter. If I could firstly echo the comments others have made about the ability of the organization to work as it has in this environment. Very impressive. Can I ask, Amin, you talked a little bit about the third party data about two billion barrels of inventory reduction. I think a lot of people are talking about missing barrels, because if you look at the public inventory data, the reduction is nowhere near as big. I just wondered about your reflection about how to reconcile that two billion barrels versus the public data. Then secondly, also in your comments, you talked about a two million barrel a day demand reduction in the period. I'm just wondering from your perspective, where you think you are seeing that from your customers. Thank you.

Speaker #7: I'm very impressed. Can I ask—I mean, you talked a little bit about the sort of third-party data, about 2 billion barrels of inventory reduction.

Speaker #7: But I think a lot of people have been talking about missing barrels, because if you look at the public imagery data, the reduction is nowhere near as big.

Speaker #7: So I guess I'm wondering about your reflections on how to reconcile the two billion barrels versus the public data. And then secondly, also in your comments, you talked about a two million barrel per day demand reduction in the period.

Speaker #7: I'm just wondering, from your perspective, where you think you were seeing that from your customers. Thank you.

Speaker #3: Thank you Alistair. You know as we said earlier you know demand is steady resilient and when you talk about inventory numbers since the start of the conflicts we've seen a 2.6 billion barrels reduction how much we have interrupted of course the east west pipeline and SPR releases resulted in a net losses of about 1.8 billion barrels.

Amin Nasser: Thank you, Alastair. As we said earlier, demand is very resilient. When you talk about inventory numbers, since the start of the conflict, we've seen a 2.6 billion barrels reduction, how much we have interrupted. Of course, the East-West Pipeline and SPR releases resulted in a net loss of about 1.8 billion barrels. Don't forget that a lot of the SPR, with the exception of maybe the one in the IEA and the US, numbers are clear, it's published. A lot of countries, with regard to their SPR and how much is in it's not public information. Our estimate of how much was utilized from this commercial inventory so far is 600 million barrels. This is the only remaining buffer in the system today. Several of these systems have hit operational tank quarter.

Speaker #3: Now, don't forget that a lot of the SPR—with the exception of maybe the one in the IEA and the US numbers, which are clear—is published. For a lot of countries, with regard to their SPR and how much is in it, it's not public information.

Speaker #3: Our estimate of how much was utilized from this commercial inventory so far is 600 million barrels, and this is the only remaining buffer in the system today.

Speaker #3: And several of these systems have hit operational tank bottoms. When people look at inventory, there is a huge commercial inventory available in the system that is tapped on.

Amin Nasser: When people look at inventory, there is a huge commercial inventory available in the system that is tapped on, other than strategic petroleum reserves, which is held by the government. These are commercial inventories available on entities and companies. The source you ask for the lost supply came from Kpler and Energy Intelligence when it comes to all the loss of supply. Inventory and how much is withdrawn, our estimate, as I said, is 600 that came from commercial inventories. The release of the IEA of 2 million barrels a day, it's now tapering off to around half a million a day because that cannot be sustained at 2 million. In Asia, we've seen the release of close to 6 million barrels that came from SPR and commercial inventories.

Speaker #3: Other than strategic petroleum reserves, which are held by the government. But these are commercial inventories available in entities and companies, so the source you asked for regarding the low supply came from Kepler and Energy Intelligence when it comes to all the loss of supply.

Speaker #3: But inventory and how much is withdrawn, our estimate, as I said, is 600 that came from commercial inventories. It's the release of the IEA of 2 million barrels a day.

Speaker #3: It's now tapering off to around half a million a day because it cannot be sustained at two million. And in Asia, we've seen the release of close to six million barrels that came from SPR and commercial inventory.

Speaker #4: Thanks, Alistair. And in fact, that's the last question that we've had on this particular call. If there are any others that people haven't had an opportunity to ask, please contact Investor Relations.

Peter Hutton: Thanks, Alastair. In fact, that's the last question that we've had on this particular call. If there's any others that people haven't had an opportunity to ask, please contact investor relations. With that, I know it's a busy day all round. I'd like to thank everybody for joining the call and to the management and their teams at this end as well. Just a reminder, our next results will be at the beginning of November for the third quarter. We look forward to talking to you and keeping you updated in the meantime. Thank you very much indeed.

Speaker #4: With that, I know it's a busy day all around, so I'd like to thank everybody for joining the call, and to the management and their teams at this end as well.

Speaker #4: Just a reminder, our next results will be at the beginning of November for the third quarter, and we look forward to talking to you and keeping you updated in the meantime.

Speaker #4: Thank you very much indeed.

Operator: Thank you, everyone. This concludes today's call. You may now disconnect. Have a good rest of your day.

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Q2 2026 Saudi Arabian Oil Co Earnings Call

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Saudi Aramco

Earnings