Shares in BP rose more than three per cent in early trading after it said it will begin returning cash to shareholders next quarter.
BP said underlying replacement cost profit rose to $1.87bn (£1.41bn) in the three months to the end of September, up from $933m during the third quarter last year.
Replacement cost profit for its upstream operations edged up to $1.24bn, from $1.20bn last year, while its downstream operations rose to $2.18bn, from $978m last year. Profits from its share in Rosneft rose to $137m, from $120m last year.
It produced an average of 3.6m barrels of oil equivalent a day during the third quarter, up 14 per cent on the same period last year.
It added it expects $4.5bn in disposal proceeds in the full year, and unveiled a quarterly dividend of 10 cents per share.
Shares were up 3.3 per cent at 518.7p in early trading.
Why it's interesting
Volatile oil prices have hit the likes of BP where it hurts in recent years, but with Brent crude prices shooting up 20 per cent in the past three months, the company said today it has brought its finances, including its full dividend, back into "organic balance".
Shareholders were buoyed by the fact it said its breakeven oil price is now $49 per barrel, well below the current average of $60 per barrel. In fact, things are going so well for the company, it unveiled a share buyback in the next quarter, although it held its dividend.
Meanwhile, payments relating to the Gulf of Mexico oil spill fell to $600m - which, considering payments for the first nine months of 2017 were $4.9bn, is a significant fall. That may be it for the year: full-year payments are now expected to hit $5.5bn.
"Gulf payments are still soaking up mind boggling quantities of cash, but are finally starting to recede," said Nicholas Hyett, equity analyst at Hargreaves Lansdown.
"New oil fields are starting to come online, supporting cash generation from the group’s upstream business. Meanwhile the Downstream business, which has been BP’s rock throughout much of the oil downturn continues to deliver excellent results. The share buyback programme is the first bone for investors from those improvements."
What BP said
Chief executive Bob Dudley said:
We are steadily building a track record of delivering on our plans and growing across our businesses. This quarter, three new upstream projects and the highest downstream earnings in five years, underpinned by reliable operations and disciplined spending, have generated healthy earnings and cash flow. There is still room for further improvement and we will keep striving to increase sustainable free cash flow and distributions to shareholders.