Saudi Arabian companies warn Aramco fuel price hike may curb earnings

Published Thu, Jan 4, 2024 · 04:10 PM

Several Saudi Arabian companies released regulatory filings late on Wednesday and Thursday (Jan 4) saying that state energy company Saudi Aramco’s decision to raise feedstock and fuel prices for this year will raise production costs and lower earnings.

Saudi Aramco notified the companies in the kingdom of the price hike this week, saying it will be effective from Jan 1. Aramco increased retail diesel prices for 2024 by 53 per cent to US$0.3067 per litre, its third increase since 2016.

The companies have said the impact from the increase in prices could start to filter through in the first quarter, and that businesses are looking for ways to enhance their efficiencies to offset the rising costs.

Nama Chemicals, Saudi Ceramic, Qassim Cement, Saudi Aramco Base Oil and Rabigh Refining and Petrochemical are among the scores of companies that said they were affected by the price increases.

Middle East Company for Manufacturing and Producing Paper on Thursday said it expected the financial impact of the price hike to be an increase of about 3 per cent in total annual sales costs.

Saudi Industrial Investment Group on Thursday said its subsidiaries face higher production costs this year because of the fuel increase. REUTERS