SAUDI Arabia's state-controlled oil giant retained its massive dividend despite a 25pc plunge in profit, and signalled it would keep spending in check as it braces for deeper damage from the oil crisis.
Saudi Aramco, the world's most valuable listed company, will pay a dividend of $18.75bn (€17.25bn) for the first three months of 2020. That would leave it on track to meet its full-year goal of $75bn, though it didn't specify if it was still committed to that number.
The dividends "are the highest of any listed company worldwide" and will be paid in the second quarter, Aramco said. The payout is crucial for the kingdom, which holds about 98pc of Aramco and is facing its worst financial turmoil in decades.
On Monday, the government tripled Vat and cut bureaucrats' allowances as it looks to rein in a fiscal deficit that could reach 13pc of gross domestic product this year.
At the time of Aramco's record initial public offering in December, the dividend was a huge part of its appeal.
A stress test carried out by JPMorgan Chase showed that if oil fell to $40 a barrel and production was nine million barrels a day, Aramco would only remain within its self-imposed borrowing target if it cut the dividend by 30pc and slashed spending dramatically.
Arab Light crude, one of the nation's main grades, plunged to as little as $13.34 a barrel last month as an Opec+ agreement to curb supply fell apart and Saudi Arabia ramped up production.
The kingdom has now changed tack and pledged to reduce output to an 18-year-low of 7.5 million barrels a day in June.
The war over market share started just as the first quarter was ending, and the impact of low prices will probably be more pronounced in the second quarter.