The state-owned Saudi oil company Aramco reported a jaw-dropping 82% increase in first-quarter profits on May 15.
Russia’s invasion of Ukraine, and the subsequent sanctions it suffered as a consequence, caused significant disruption to the global oil and gas supply. As sanctions curtail Russian crude from entering many western markets, prices continue to rise.
In this context, Aramco reported its highest quarterly profits to date, raking in $39.5 billion between January 1 and March 31, up from $21.7 billion the same quarter last year.
The company announced this windfall just days after its share price overtook Apple’s, making Aramco the most valuable company in the world.
In a statement, Aramco’s President and CEO Amin H. Nasser said, “Against the backdrop of increased volatility in global markets, we remain focused on helping meet the world’s demand for energy that is reliable, affordable and increasingly sustainable.”
Nasser went on to say that Aramco would increase its production capacity in anticipation of further growth in demand.
Aramco is not the only oil company enjoying higher-than-normal margins this year. Shell reported record profits for the same quarter, $9.1 billion, nearly three times as much as their first quarter the previous year and the highest number since 2008.
BP also generated profits that more than doubled the previous year’s first quarter. The company cleared $6.2 billion. The London-based oil giant was also able to write off roughly $25.5 billion in losses tied to the company’s planned divestment from its Russian holdings.
In terms of worldwide oil production, Russia is the third-largest behind the United States and Saudi Arabia, with a market share of 11%, according to the U.S. Energy Information Administration.
However, Russia’s war in Ukraine cannot assume full responsibility for skyrocketing oil prices. Demand and prices were already surging in 2021, as countries worldwide began relaxing COVID-19 restrictions and reopening their economies.
