Saudi Companies Brace For Increased Energy Bills As Aramco Raises Prices

RIYADH: Several companies in Saudi Arabia announced expectations of higher energy bills following Aramco raising its prices. 

Rabigh Refining and Petrochemical Co., also known as Petro Rabigh, said in a statement on Tadawul that it has received an official notice from the energy giant to increase feedstock prices and fuel oil starting from Jan. 1 this year. 

The company added that the financial mark of the increase is estimated to be approximately 0.9 percent of the company’s annual cost of sales. 

This impact is expected to appear starting from the first quarter of the fiscal year 2024. 

The Power and Utility Co. for Jubail and Yanbu, known as Marafiq, has also received an official notification from Aramco to increase the prices of energy products starting from the beginning of the year. 

However, Marafiq noted in a statement on Tadawul that it is still in the “studying” stage and evaluating the financial impact, which will be announced once completed, and the effect will appear starting from the first quarter of the fiscal year. 

The company is also working to mitigate the ramifications of this increase by enhancing production efficiency and plant reliability, optimizing asset use, and reducing company costs. 

Additionally, National Industrialization Co., also referred to as Tasnee, announced on Tadawul that it received the same notification from Aramco regarding raising feedstock prices. 

“The financial impact of this notice is expected to be an increase in the total cost of sales by 2.5 percent of the associates and joint venture companies, according to the latest audited financial,” the company said in the statement. 

This will be reflected starting from the first quarter of the year. 

Furthermore, Arabian Cement Co. announced that it will amend the prices of fuel products used in cement production starting from Jan. 1 this year, following Aramco’s notice. 

“This amendment will increase cost of production, noting that the company is working on calculating the expected financial impact,” the company stated on Tadawul. 

It added: “The company will also work during the coming period on exploring ways to reduce the impact of this amendment on the company’s financial results.”