Sabic’s CEO: the drop in oil prices is temporary and Sabic seeks to improve its profits

The decline in oil prices is temporary even if it lasts a year because population growth will ultimately trigger higher consumption and prices, the chief executive officer of Saudi Basic Industries Corp, Mohamed al-Mady, told reporters Sunday after the company announced a 4.5 percent drop in 3rd quarter profit.

The results, which missed analysts’ forecast, was blamed on sluggish sales in the 3rd quarter. Sales dropped to SAR 48.71 billion from SAR 48.80 billion year-on-year,  he said, according to reuters.

Oil prices affect Sabic’s earnings through the prices of raw materials and final products, Mr al-Mady said.

China is a growing economy but there is a change in consumption trends there, he added, but Sabic is interested in investing in China.

Sabic is working on several programs to increase profitability and improve results, he was quoted as saying in the Saudi Press Agency. Sabic is also eyeing investment in Shale gas overseas because of the low cost of production in Europe, America and Australia.