As all Fools know, oil prices have jumped around in the past five quarters like a proverbial cork in a storm. The result has been difficultfor most of the companies, except for the deepwater drillers, namely Diamond Offshore (NYSE: DO) and Transocean (NYSE: RIG), both of which have seen their rigs generally remain contracted.

Diamond Offshore reported its third quarter results on Thursday and the second-largest drilling contractor did a great deal to make itself proud. From a purely earnings standpoint, the company checked in with income of $361.4 million, or $2.62 a share, improving on earnings of $310.5 million, or $2.23 per share in the third quarter of 2008. Analysts who follow the company had been anticipating a consensus of $2.30 per share.

At the same time, Diamond Offshore announced regular and special dividends for the quarter. The company's regular dividend will amount to 12.5 cents per share. The special dividend, for which Diamond has become somewhat noteworthy, will total $1.875. As such, the total will amount to $2.00 per common share.

Diamond's earnings overage for the quarter coincided with that of Noble (NYSE: NE), third largest of the deepwater drillers, beat last year's earningsby 11%. Noble, like both Diamond offshore and Transocean has a number of rigs working in the waters of the Santos basin offshore Brazil. Transocean, however, will make us wait until November before announcing its third quarter results.

If you listened to the company's conference call, you know that a couple of Diamond Offshore's key accomplishments were the acquisition, at attractive prices, of the Ocean Courage and the Ocean Valor, two dynamically positioned drilling rigs that can operate in up to 10,000 feet of water. At the same time, as the quarter came to a close, the company issued $500 million of 30 year notes at a 5.7% interest rate.

At the same time, during its call, management was asked about rumors that ExxonMobil (NYSE: XOM) would raise its capex by 10% to 12% in 2010, primarily outside North America. Management response was unclear, at best. But my strong feelings are that, with oil prices heading higher, the budgets of other international oil companies like Chevron (NYSE: CVX), BP (NYSE: BP), and Total (NYSE: TOT) almost certainly are headed north as well.

Among the key beneficiarieswill surely be Diamond Offshore, Transocean, and Noble.

Diamond Offshore is a four-star company as rated by Motley Fool CAPSplayers. Why not go into the company's CAPS pageand tell us how you'd cast your ballot?

This article was originally published as A Deepwater Stock You Shouldn't Misson Fool.com

Copyright © 2009 The Motley Fool, LLC. All rights reserved.