Saudi oil giant Aramco, the world's largest oil company, reported a 25% increase in first-quarter profits on Sunday, driven by a strategic shift in exports to its East-West Pipeline to bypass the Strait of Hormuz, which has been disrupted by the ongoing Iran war.
Profit Surge and Strategic Response
Formally known as the Saudi Arabian Oil Co., Aramco posted a profit of $32.5 billion for the quarter ending March 31, compared with a 12% decline in annual profits in 2025. The state-owned company attributed the growth to its operational flexibility amid geopolitical turmoil.
"Aramco's first-quarter performance reflects strong resilience and operational flexibility in a complex geopolitical environment," said President and CEO Amin H. Nasser in a statement. He noted that the company's East-West Pipeline, which runs across Saudi Arabia from its Eastern oil fields to the Red Sea, is now operating at maximum capacity of 7 million barrels per day, "helping to mitigate the impact of a global energy shock and providing relief to customers."
Pipeline Cannot Replace Lost Capacity
However, the pipeline cannot fully compensate for the shipping disruption in the Strait of Hormuz. Before the war, 20% of the world's traded oil, along with large quantities of natural gas, fertilizer, and other petroleum products, flowed through the strait daily. Iran effectively seized control of the critical waterway after the U.S. and Israel attacked it on February 28, and a subsequent U.S. naval blockade has further complicated its use.
"Recent events have clearly demonstrated the vital contribution of oil and gas to energy security and the global economy, and are a stark reminder that reliable energy supply is critical," Nasser added. "Despite these headwinds, Aramco remains focused on its strategic priorities and is leveraging both its domestic infrastructure and its global network to navigate disruption."
The company's ability to reroute exports through its pipeline has provided a crucial buffer, but the loss of Hormuz transit capacity continues to strain global energy markets.
