Positive results from refining operations offset the impact of lower crude oil prices in the first quarter compared to the same period last year, which led to higher profits, and allowed Exxon Mobil and Chevron to pay out $8.1 billion and $6.6 billion, respectively, to their shareholders. .
“We are delivering strong financial results and increasing cash returns to shareholders,” Chevron CEO Mike Wirth said, noting a 65% increase in shareholder payouts over the same period last year.
The results extend the period of prosperity of the two American oil giants after the outbreak of the war between Russia and Ukraine and its repercussions on the energy market.
Both companies pointed to recent windfall taxes that have prevented them from making bigger profits.
The results of both companies had improved in 2022 due to the increase in crude oil prices after the Ukraine crisis.
In the last quarter, oil prices approached $70 a barrel.
Although this represents a drop from its price recorded at the start of the crisis, crude prices remain at a fairly high level.
ExxonMobil’s first-quarter profit more than doubled to $11.4 billion, while revenue fell 4.3% to $86.6 billion.
While crude prices fell 23% from the same period in 2022, oil and natural gas production rose 4.1%.
Criticism of oil companies
ExxonMobil relies on an integrated model that makes it a consumer of crude oil in its network of oil refineries, meaning it has also benefited from lower oil prices.
Its CEO, Darren Woods, said the company is “increasing its value by increasing production to meet global demand”.
Woods described current market conditions as “pretty mixed”, noting that the sector has gone through a subdued period in terms of demand.
The main question is how much demand will increase in China as its economy reopens.
In a “tight” market, Woods said, there aren’t many levers to increase production.
Chevron’s profit rose 5% to $6.5 billion, while revenue fell 6.6% to $50.8 billion.
The company’s oil and gas production volumes declined due to the sale of assets and the expiration of an operating concession in Thailand.
The huge profits made by America’s oil giants have drawn criticism from President Joe Biden and other officials, who have urged oil producers to increase production volumes in a time of high inflation, rather than spend money extra money in dividends and share buybacks.
Exxon Mobil said the first quarter included paying an additional $200 million due to new European energy taxes.
Chevron also said it would pay an additional $130 million due to energy profits tax in Britain.
Exxon Mobil shares rose 2.1% to $119.21, while Chevron shares fell 0.7% to $165.71.
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