Chinese And Saudi Oil Giants Book Mammoth Losses -- Oilprice -- August 31, 2020

Link here. 

The first two quarters of the current year have been brutal to U.S. oil and gas companies. According to Refintiv data, the energy sector has recorded the lowest Q2 2020 earnings growth rate (-168.5 percent) of any U.S. sector with earnings clocking in at -$10.5B vs. $15.3B in the year-ago comparable quarter. That's far worse than the S&P 500 average earnings growth rate of -19.1 percent when you exclude the energy sector. As expected, oilfield service companies operating in the Shale Patch have been faring worse than most thanks to huge capex cuts by producers.

But U.S. shale producers can take some comfort in the fact that their counterparts elsewhere have not been doing much better.

Saudi and Chinese oil and gas giants have been booking massive losses, too, proving that Covid-19 is a pandemic of equal opportunity.

In the first half of 2020, Saudi oil revenue plummeted by 42.6 percent year-on-year to SAR 224.73 billion ($60.68B), compared to SAR 391.3 billion ($105.65B) for last year's corresponding period. April and May recorded the biggest revenue slumps at 65.4 percent and 66.1 percent, respectively, to SAR 24 billion ($6.48B) and SAR 23.87 billion ($6.44B), respectively.

Net profit at Saudi Aramco (ARMCO) slumped 73 percent to 24.6B riyals ($6.57B) in Q2 vs. estimates of 31.3B riyals. But unlike BP Plc. (NYSE:BP) and Royal Dutch Shell (NYSE:RDS.A), which cut their dividends in recent months, the majority state-owned company maintained its Q2 dividend of $18.75B. Aramco plans to cut 2020 capex to a range of $20-$25B in 2020 in order to pay the$75B dividend it pledged to investors during its IPO.

China--the world's largest oil importer-- has been importing less from Saudi Arabia as it boosts imports from the U.S., ostensibly in a bid to fulfill its obligations for the January trade deal.

Much more at the link.