BP has discovered that there is indeed money in misery, posting its highest quarterly profit in nearly two decades as the war in the Middle East sent oil and gas prices soaring. The energy giant cheerfully described it as a "banner quarter" on Friday, with underlying replacement cost profit - the industry's preferred way of saying "look how much money we made" - nearly quadrupling to $8.46bn (£6.3bn), up from $2.2bn a year ago. Analysts had expected $7.3bn, so BP beat expectations the way a student beats a curve they helped set.

Chief executive Meg O'Neill told Bloomberg TV: "It really was a banner quarter for the refining business. We had very strong margins from the BP-operated refineries, we also had very strong underlying performance. We were able to capture the opportunity provided by the market." The "opportunity" in question being a war, which is the sort of market condition that tends to be bad for civilians and excellent for quarterly earnings.

The refining business did the heavy lifting, as the gap between the cost of crude oil and the price of refined fuels like diesel and gasoline widened enough to earn almost $47 for each barrel produced. Global oil prices remain below the peaks of the 2022 energy crisis, but pump prices for fuels including diesel have hit all-time highs across the UK, Europe and the US in recent months, thanks to severe disruptions at refineries in the Gulf region and across Russia.

O'Neill praised the oil and gas industry for its "remarkable adaptability," noting that refineries have been running close to capacity to make up for shortfalls, shipping has been taking different and longer routes, and releases from strategic and commercial reserves are helping to bridge supply gaps. Adaptability, it turns out, is very profitable when you're the one adapting.

The quarterly profit was BP's highest since the $8.9bn recorded in 2008, a year that also featured a global financial crisis, proving that BP has a knack for thriving in years that end in disaster for everyone else.

The timing is awkward for British motorists, who are now paying 198.79p a litre for diesel and an average of 172.92p a litre for petrol, according to the RAC - up from 132.83p in late February, before the latest conflict in the Middle East began. Climate campaigners were quick to point out the optics. Jonathan Noronha-Gant of Global Witness called it "obscene that polluters are continuing to cash in on the fallout of the war in Iran, making more bumper profits from spiralling oil prices while innocent civilians suffer." He added that the massive profits come as ordinary people across Europe struggle with the rising cost of living, with many struggling to afford to heat their homes as winter arrives.

Danny Gross of Friends of the Earth said: "As millions of households brace themselves for a cold winter, huddling under blankets and clutching hot-water bottles as they struggle to pay their bills, BP is raking in huge profits while doubling down on gas and oil production and slashing investment in renewables." BP, for its part, has not commented on the blanket-and-hot-water-bottle economy, but one assumes it is bullish on blankets.

BP's windfall follows similar bumper results from Shell and French rival TotalEnergies, both of which reported their strongest profits since 2022, also largely thanks to refining crude into fuels like diesel. The US-Israeli war on Iran has been good for oil company balance sheets, raising questions about how they will spend the extra cash. BP said Friday it would use the excess cashflow to pay remaining liabilities in full from the 2010 Deepwater Horizon oil spill. Last week, it announced a deal providing Louisiana with an accelerated, lump-sum $350m payment to resolve claims linked to the spill, while also settling long-running coastal damage litigation by local parishes. Nothing says "banner quarter" like finally paying off a 15-year-old environmental disaster.

BP is expected on 15 December to set out its first big strategy update under O'Neill, which market observers expect will outline plans to grow oil and gas production and potentially restart share buy-backs from next year. Part of BP's reorganisation includes plans to sell off its UK oil and gas assets in the North Sea in a deal that could be worth between £2bn and £2.5bn. O'Neill said in August there had already been strong interest in BP's five major production hubs, including the Andrew and ETAP fields in the central North Sea, plus the Glen Lyon, Clair, and Clair Ridge fields west of Shetland. North Sea companies such as Neo Next+, Ithaca Energy and Adura - the joint venture behind the Jackdaw and Rosebank fossil fuel developments - have all been named as potential suitors.

Last month, BP appointed a new chair, Ian Tyler, after a months-long search triggered by the ousting of Albert Manifold, seeking to draw a line under years of boardroom turmoil. Nothing says "new era" quite like a war-driven profit surge and a fire sale of North Sea assets, but BP is nothing if not adaptable.