Saudi Aramco, the world’s largest oil producer, reported a 33 percent increase in adjusted net income for the second quarter of 2024, despite significant disruptions to its supply routes linked to ongoing conflict in the Middle East. The company announced earnings of $33.4 billion for the April-June period, up from $25.2 billion in the same quarter last year.

The rise in profits comes amid elevated energy prices driven by geopolitical tensions related to the conflict involving Israel, Iran, and regional actors. Since late February, Iran’s actions have restricted vessel traffic through the Strait of Hormuz, a vital maritime passage for Persian Gulf oil exports. In response, Saudi Arabia redirected over 70 percent of its oil shipments through an alternative pipeline running from its eastern oil fields to Red Sea port terminals, enabling continued exports of millions of barrels per day.

Saudi Aramco’s production averaged the equivalent of 9.5 million barrels per day in the quarter, down from 12.6 million barrels in the first quarter. However, higher global prices—averaging $108 per barrel compared with $77 in the prior quarter—contributed to the company’s robust financial performance. Chief Executive Amin H. Nasser described the recent months as “one of the most challenging ever” for the company, crediting the pipeline system with mitigating supply losses.

Complicating the situation further, the Bab-al-Mandab Strait, another critical transit point on the Red Sea route, has been targeted by the Houthi movement, an Iranian-aligned militia in Yemen. The Houthis declared a blockade on Saudi vessels there in late July and have reportedly conducted attacks on several ships. Saudi Arabia has responded by assembling a coalition aimed at protecting maritime traffic in the Red Sea. Meanwhile, much of the kingdom’s oil exports are now rerouted through Egypt, though tankers in that area face threats from drone strikes.

Iran stated on Monday that it was engaging in discussions with Oman regarding a potential temporary reopening of the Strait of Hormuz. This followed a decision by former U.S. President Donald Trump to cancel a planned military strike on Iran over the weekend, citing diplomatic progress and appeals for calm from Saudi Arabia and allies.

Nasser emphasized that the Houthi attacks have so far had “no material impact” on Aramco’s operations but warned that ongoing disruptions to shipping routes could harm the global economy.

Saudi Arabia’s government holds a controlling stake of over 80 percent in Aramco, with the remainder largely owned by the Public Investment Fund. The company employs more than 76,000 people. The kingdom’s economy, however, has been negatively impacted by the conflict, with gross domestic product estimated to have contracted by about 4.8 percent in the second quarter compared to the previous year.

Other major oil companies benefiting from the rise in energy prices include Exxon Mobil and Chevron. Exxon reported $14.5 billion in quarterly profits, more than doubling its earnings year-over-year, while Chevron’s profit increased to $12.1 billion from $2.5 billion a year earlier. British energy company BP also more than doubled its second-quarter earnings to $5.7 billion. BP’s CEO, Meg O’Neill, acknowledged challenges remain despite the gains, pointing to ongoing efforts to reduce debt and improve operational efficiency. Recently, BP announced its decision to exit the North Sea after over 60 years of production.

Meanwhile, former U.S. President Trump criticized oil companies for their profits, calling on them to reduce consumer prices and return some of their windfalls to the public.