NorthAmOil: ExxonMobil, Chevron profits soar

The US’s two largest oil companies have posted record profits as blowback continues, including from politicians and consumer groups, and in particular from US President Joe Biden.

ExxonMobil reported profits of $55.7bn in 2022. Its previous record was $45.2bn in 2008, when oil was $142 a barrel, 30% higher than in 2022. Earnings for the fourth quarter were $12.8bn, 44% more than a year earlier but down 35% from the third quarter.  Oil prices eased after a high in the late summer.

An adjusted per-share profit of $3.40 beat analysts’ consensus of $3.29 per share.

ExxonMobil has the highest market capitalisation of any oil and gas producer globally.

The company’s high earnings are in large part because of Russia’s war in Ukraine, which has led to sanctions on Russian oil exports and driven up prices for crude, gas, gasoline and diesel.

After ExxonMobil released its financials, the White House shot back: "The latest earnings reports make clear that oil companies have everything they need, including record profits and thousands of unused but approved permits, to increase production, but they’re instead choosing to plough those profits into padding the pockets of executives and shareholders while House Republicans manufacture excuse after excuse to shield them from any accountability."

A few days earlier, Chevron – the second largest US oil producer – had posted record earnings of $36.5bn for 2022, more than double its profits a year earlier. The full-year 2022 earnings exceeded its previous record of $26.9bn in 2011.

In the fourth quarter, the company reported adjusted earnings of $7.9bn, or $4.09 per share, below analysts' estimate of a profit of $4.38 per share, according to Refinitiv data. Profits from oil and fuel were weaker than forecast.

At issue for critics is that Chevron in 2022 paid out $26bn in dividends and buybacks to shareholders. It also invested $15.7bn in operations.

This year, it said it will increase expenditure on projects to $17bn, with two-thirds of that in the US.

In the fourth quarter, the company’s global net oil-equivalent production was 3.01mn bpd and 3mn bpd for the entire year, down 3% from a year earlier. But US production rose 4% compared with 2021, due in large part to gains in the Permian Basin.