Exxon and Chevron profits soar on surging oil and gas prices

Earnings at US supermajors ExxonMobil and Chevron soared to multiyear highs within the third quarter as surging oil and fuel costs buoyed their funds amid scrutiny over their clear vitality methods.

Chevron on Friday reported internet revenue of $6.1bn, its highest quarterly revenue for the reason that first quarter of 2013 and nicely above Wall Road estimates for $4.1bn, based on knowledge compiled by S&P World Market Intelligence. ExxonMobil’s $6.8bn revenue was its highest since late 2017.

“We had one other sturdy quarter. Highest earnings in over eight years, highest free money move within the firm’s historical past, greater even than the strongest quarters greater than a decade in the past when oil costs had been nicely above $100,” Pierre Breber, Chevron’s chief monetary officer, informed the Monetary Instances. “We’re a greater firm than we had been pre-Covid.”

Crude costs have surged to greater than $80 a barrel in current months and pure fuel value have hit file highs all over the world. It’s a dramatic reversal from final yr, when a deep downturn devastated the business’s funds.

Each firms stated they remained targeted on paying down debt and returning money to shareholders reasonably than accelerating spending to raise output.

Officers of Joe Biden’s administration have pushed some within the business to extend manufacturing to assist ease the surge in costs on the pump, the place US customers are paying the very best costs in years.

Breber stated Chevron’s output was up 7 per cent from final yr and that “we’ll see greater capital” spending subsequent yr. The corporate stated it was sticking by its beforehand introduced spending plans at the same time as costs have soared.

The rise in costs “feels extra cyclical than structural,” stated Breber. “We had fast demand decreases final yr, adopted by fast will increase this yr, and it’s onerous for provide to regulate as rapidly as demand and it does seem that provide is lagging.”

ExxonMobil elevated its quarterly dividend from $0.87 a share to $0.88, the primary improve since 2019. It stated it deliberate to launch a share buyback scheme of as much as $10bn subsequent yr.

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The surge in earnings from greater fossil gas costs got here a day after the businesses’ chief executives, together with the US bosses of BP and Shell, had been grilled by US lawmakers over allegations the businesses had waged a decades-long disinformation marketing campaign to cover the risk from local weather change.

The US supermajors are additionally beneath scrutiny from some shareholders who argue they don’t seem to be shifting quick sufficient to construct up their low-carbon companies, leaving themselves in danger if the world shifts quickly to scrub vitality.

Darren Woods, Exxon’s chief govt, stated excessive earnings from oil and fuel would “present the near-term money flows to fund lower-carbon alternatives”.

For Exxon, the bumper quarter got here simply months after it misplaced a high-profile battle with activist hedge fund Engine No 1, which price it three seats on its board of administrators.


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