Saudi Aramco profits soar 39% in the third quarter to $42 billion, fueled by higher global crude prices

• Saudi Aramco posted a 39% jump in third-quarter profit to $42.4 billion in its earnings Tuesday.
• Higher oil prices driven by the Ukraine war and OPEC+ cuts have helped lift energy majors' profits.

Saudi Aramco posted a 39% leap in third-quarter profit Tuesday, thanks to a surge in crude oil prices that has driven bumper earnings for energy majors across the world.

The state-owned energy company, formally named Saudi Arabian Oil Co., reported net income of $42.4 billion in the quarter, up from $30.4 billion in the same period last year. It also posted a record free cash flow of $45 billion, an increase from $28.7 billion the year prior.

"While global crude oil prices during this period were affected by continued economic uncertainty, our longterm view is that oil demand will continue to grow for the rest of the decade, given the world's need for more affordable and reliable energy," Saudi Aramco's president and CEO, Amin Nasser, said in a statement.

The OPEC+ group of oil producers — where Saudi Arabia is the de facto leader — slashed production quotas by 2 million barrels a day in early October in a bid to elevate prices.

Oil prices have risen nearly 20% this year, hitting highs above $120 a barrel in March on the fallout from Russia's war on Ukraine. The conflict has triggered Western sanctions against Moscow and curbed supply.

That has helped drive bumper earnings for global energy majors in recent months, which has led to calls for a windfall tax to help economies struggling with soaring power costs. US President Joe Biden threatened Monday to hit energy companies with a tax if they didn't invest their profit.

Brent crude, the international benchmark, was 1.4% higher at $94.13 a barrel at last check Tuesday, while WTI crude was up 1.3% at $87.66 a barrel.

But oil prices have dropped over 6% in the last three months, dragged on by fears that a recession will weigh on demand, in particular as a result of China's faltering economy. The world's second-biggest economy has returned to imposing COVID-19 curbs including lockdowns, which hit businesses and so have dampened hopes for demand.