Trade friction impacts Saudi Aramco profits, Trump's Middle East trip focuses on investment cooperation

As US President Trump makes an important visit to Saudi Arabia this week, the uncertainty brought about by the trade war it has sparked is having a negative impact on the world's largest oil company, Saudi Aramco.

Saudi Aramco announced on Sunday that its net profit for the first quarter of 2025 decreased by 5% year-on-year to $26 billion due to global trade tensions suppressing oil prices. As a result, Saudi Aramco has lowered its dividend adjustment for the fourth quarter of last year from $31 billion to $21.4 billion.

The CEO of the company, Amin H. Nasser, pointed out that "the significant changes in global trade situation in the first quarter of 2025 will have a significant impact on the energy market, and economic uncertainties will put pressure on crude oil prices." Since Trump implemented the "Liberation Day" tariff policy, oil prices have continued to be under pressure, and the market is concerned that it will drag down global economic growth.

OPEC recently announced an increase in production to further pressure international oil prices, which currently remain at around $64 per barrel. Saudi Aramco revealed that its average crude oil selling price in the first quarter was $76.30 per barrel, a decrease from $83 in the same period last year.

The company's stock price has fallen by over 3% in the past month, with a cumulative decline of nearly 17% over the past year. The pressure on stock prices this time comes as Trump prepares to embark on his Middle East tour, planning to visit Saudi Arabia, Qatar, and the United Arab Emirates in an effort to facilitate multiple large-scale investment agreements.

Trump has expressed his hope that Riyadh will inject over $1 trillion into the US economy. White House Press Secretary Karoline Leavitt stated that Trump's visit will promote a "historic return" to the Middle East, emphasizing the establishment of a new cooperation framework between the United States and Middle Eastern countries based on business and cultural exchanges to replace extremism.

Robert Mogielnicki, Senior Researcher at the Arab Gulf Countries Institute in Washington, told Reuters that the Trump administration expects this visit to be a milestone event, bringing multiple noteworthy and favorable cooperation agreements for the United States.

Before Saudi Aramco's profits came under pressure, its main competitors Shell and BP also experienced a significant decline in profits. The BP report shows a sharp drop of 49% in first quarter profits, while Shell's profits decreased by nearly one-third during the same period.

For Saudi Aramco, in which the Saudi government holds 81.5% of the shares, the decline in profits will intensify the pressure on Saudi Arabia to promote economic diversification. The "Vision 2030" plan led by Crown Prince Mohammed is committed to promoting Saudi Arabia's transformation from a traditional oil economy to a tourism, sports, and business center, with the goal of creating an open economy with international competitiveness.

From the perspective of the public, the decline in oil prices has brought about favorable effects in reducing fuel costs. Oil prices have recently fallen to their lowest level since 2021, easing the burden of fuel costs on consumers.