Exxon, Chevron Post Record Revenues

An oil field in the United States (Reuters)
An oil field in the United States (Reuters)
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Exxon, Chevron Post Record Revenues

An oil field in the United States (Reuters)
An oil field in the United States (Reuters)

The two largest US oil companies, Exxon Mobil Corp and Chevron Corp, posted record revenue in Q2 2022 on Friday.

With crude surging above $100 a barrel shortly after the Russian invasion on Ukraine, and refining margins climbing due to tight plant capacity, ExxonMobil reported $17.9 billion in profits and Chevron $11.6 billion in the just-finished second quarter.

The results come on the heels of similarly jaw-dropping figures from European petroleum heavyweights, with Shell reporting $18 billion in profits, Total Energies $5.7 billion and Eni $3.8 billion.

Crude prices traded between $95 and $120 a barrel during the quarter, as the war and the wave of sanctions on Moscow lifted the oil market back to levels last seen in 2008.

On Friday, both companies reported higher oil and natural gas volumes in the United States, with ExxonMobil boosted by an increased 130,000 barrels of oil-equivalent in the Permian Basin in Texas and New Mexico, and Chevron notching a three percent rise in US volumes.

ExxonMobil plans to add 250,000 barrels per day of refining capacity at its Beaumont, Texas plant in the first quarter of 2023, representing “the industry's largest single capacity addition in the US since 2012,” ExxonMobil Chief Executive Darren Woods said in a news release.

Both companies reported big increases in revenues, with Exxon Mobil's jumping 71% to $115.7 billion and Chevron 83% to $69 billion.

This rise is considered one of the main factors behind the global inflation that hit unprecedented levels for decades in the United States and Europe.

Inflation is already changing where Americans go and what they eat. It's also changing the way they consume energy. Inflation in Europe has also been surging, including soaring costs for energy.

The two companies, which suffered significant financial losses early in the COVID-19 pandemic as petroleum demand tanked, have not used the mountains of cash from higher prices to significantly lift capital spending, which remains below the level prior to the pandemic.

Instead, the companies have been steering funds to shareholders. ExxonMobil paid out $7.6 billion in distributions during the quarter, while Chevron lifted the top end of its annual share repurchase range to $15 billion from $10 billion.

Shares of ExxonMobil jumped 4.1% to $96.39 in trading near midday, while Chevron leaped 8.5% higher to $163.19.

The ensuing surge in US gasoline prices to an all-time high in mid-June has squeezed American families and pressured President Joe Biden, who has had a fractious relationship with ExxonMobil and Chevron and the oil industry more generally.

In June, Biden ripped the industry for spending excess cash on share buybacks instead of significantly boosting capital spending.



Oil Steadies as Market Awaits Fresh US Tariffs

FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
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Oil Steadies as Market Awaits Fresh US Tariffs

FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo

Oil prices were little changed on Wednesday as traders remained cautious ahead of US tariffs due to be announced at 2000 GMT, fearing they could exacerbate a global trade war and dampen demand for crude.

Brent futures were down 7 cents, or 0.09%, at $74.42 a barrel by 0858 GMT. US West Texas Intermediate crude futures fell 5 cents, or 0.07%, to $71.15.

The White House confirmed on Tuesday that President Donald Trump will impose new tariffs on Wednesday, though it provided no detail on the size and scope of the trade barriers, according to Reuters.

Trump's tariff policies could stoke inflation, slow economic growth and escalate trade disputes.

"Crude prices have paused last month's rally, with Brent finding some resistance above $75, with the focus for now turning from a sanctions-led reduction in supply to Trump's tariff announcement and its potential negative impact on growth and demand," said Ole Hansen, head of commodity strategy at Saxo Bank.

Traders will be watching for levies on crude imports, potentially driving up prices of refined products, he added.

For weeks Trump has touted April 2 as "Liberation Day", bringing new duties that could rattle the global trade system.

The White House announcement is scheduled for 4 p.m. ET (2000 GMT).

"The balance of risk lies to the downside, given that weaker than expected tariff measures are unlikely to drive a significant rally in Brent, while stronger than expected measures could trigger a substantial selloff," BMI analysts said in a note.

Trump has also threatened to impose secondary tariffs on Russian oil and on Monday he ramped up sanctions on Iran as part of his administration's "maximum pressure" campaign to cut its exports.

"Markets likely to be volatile ahead of the final announcements on tariffs and the scale of them. The threat of secondary tariffs on Russian crude continues to provide some support for prices, with more downside risk at present around tariff uncertainty," said Panmure Liberum analyst Ashley Kelty.

US oil and fuel inventories painted a mixed picture of supply and demand in the world's biggest producer and consumer.

US crude oil inventories rose by 6 million barrels in the week ended March 28, according to sources citing the American Petroleum Institute. Gasoline inventories, however, fell by 1.6 million barrels and distillate stocks were down by 11,000 barrels, the sources said.

Official US crude oil inventory data from the Energy Information Administration is due later on Wednesday.