MW Saudi Aramco promises full production can be restored within days if Strait of Hormuz is reopened

By Jules Rimmer

Aramco is looking to divert oil exports westwards to the Red Sea

Aramco is the world's largest oil company both by market capitalization and production.

During an investor call Tuesday to announce full-year earnings for 2025, Saudi Aramco's chief executive officer Amin Hassan Nasser reassured oil markets that in the event of the Strait of Hormuz reopening for shipping traffic, the world's largest oil company would restore production to full capacity "within days."

While that might comfort energy importers and economists concerned about inflation, Nasser's response to an analyst's question about the plausibility of U.S. proposals for its navy to escort shipping through the strait was less encouraging. "We support any action or measures that will support delivering our products to our customers, to the global market." The non-committal reply did not express confidence.

No wonder: on Monday, during an interview aired on CNBC, a spokesman for Iran's Ministry of Foreign Affairs made a veiled threat when he warned oil tankers transiting the Strait of Hormuz "must be very careful."

Earlier on Tuesday, Nasser had warned of "catastrophic consequences" for the oil market were the Strait of Hormuz to remain effectively closed for an extended period and of "a serious impact on the global economy."

"Unfortunately", he went on to say, most of the spare capacity in the world's oil market is in the Middle East and generally exists through the vital strategic chokepoint off Iran's western coastline.

Aramco's CEO emphasized how important this bottleneck could become given his expectations for an increase of 1.1 million barrels per day in global demand in 2026 to a total of 107 million barrels.

However, mitigating some of the supply challenges the region's oil producers are facing, Nasser pointed out that Aramco is close to being able to divert most of its production onto an east-west pipeline, its only alternative route to export markets. Aramco, which drills about 7 million barrels daily, expects to be redirecting 5 million barrels to its port at Yanbu on the Red Sea in the very near term.

Aramco announced full-year adjusted net income of SAR 392 billion (almost $105 billion), modestly higher than expectations of SAR 380 billion. It generated $85 billion of free cash flow, revealed a $3 billion share buyback program over the next 18 months and increased its dividend 3.5% to almost $22 billion for the fourth quarter.

Despite the rising price of oil, Aramco's share price (SA:2222) has languished and has declined more than 3% so far in 2026, versus a 25% rise in the U.S.-listed energy ETF and the 50% jump in Brent (BRN00). Given much of Aramco's profits are taxed away by the Saudi government, it lacks the operating leverage to higher oil prices that would make it more appealing to fund managers although its yield of around 4.85% offers some downside support.

-Jules Rimmer

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March 10, 2026 07:16 ET (11:16 GMT)

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