Saudi firm Aramco expects a 90% rise in second-quarter 2022

• Saudi oil giant Aramco expects Profits for the second quarter of 2022 of about $48.4 billion (£40 billion).
• Company’s half-year profits reached $87.9 billion (£72.4 million).
• Soaring oil prices have fueled proposals in the UK for a windfall tax on oil and gas companies.

Saudi oil giant Aramco expects Profits for the second quarter of 2022 of about $48.4 billion (£40 billion), a 90% rise year on year.

The amount has surpassed the firm’s quarterly profit record set in May, with rising energy prices due from Vladimir Putin’s invasion of Ukraine providing windfalls to oil companies.

The $48.4 billion number is greater than the total earnings for the first six months of last year, which was $47 billion (£39 billion).

It is also the corporation’s best quarterly profit since it went public in 2019, when the Saudi government, which controls 98% of the company, sold a 1.7% stake to the Saudi public and regional institutions.

As oil prices continue high globally, Aramco’s half-year profits reached $87.9 billion (£72.4 million), putting the company on track to greatly outperform its full-year earnings in 2019, prior to the epidemic, when profits reached $88 billion.

Profits were driven mostly by higher crude oil prices and volumes sold, as well as improved refining margins, according to the business.

Following President Putin’s invasion of Ukraine, Western countries have pledged to reduce their reliance on Russian oil for energy purposes.

However, oil prices had already begun to rise prior to the war as countries recovered from the pandemic and supply could not keep up with demand.

Earnings at global oil firms such as BP and Shell have increased to their greatest level in at least a decade as commodity prices have risen, despite the fact that many of them have lowered the value of assets as a result of quitting Russia.

The large gains have fueled proposals in the UK for a windfall tax on oil and gas companies to help consumers cope with the cost of living crisis caused by skyrocketing energy costs.

For more than a year, the Labour Party has advocated for a windfall tax on oil company profits, with shadow climate change and net zero secretary Ed Miliband previously calling it “an unanswerable case.”

According to the party, the proceeds of such a tax might be used to provide additional assistance to UK households facing a cost-of-living problem.

Soaring oil prices have offered a significant boost to the Saudi economy, which reported the highest growth in a decade in the first quarter of the year.

However, Conservative leadership candidate Liz Truss defended revenues at energy companies earlier this week, saying profits should not be deemed “dirty and evil.”

She called the idea of a windfall tax “crushing business.”

A windfall tax is a one-time fee imposed on businesses that have benefited from circumstances for which they were not responsible.

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