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A12 BUSINESS
Saturday 30 July 2022

Unprecedented profit for major oil

drillers as prices soared

By CATHY BUSSEWITZ
AP Energy Writer
NEW YORK (AP) — Oil com-
panies swam in record prof-
its over the last few months
at a time when Americans
struggled to pay for gaso-
line, food and other basic
necessities.
On Friday, Exxon Mobil
booked an unprecedent-
ed $17.85 billion profit for
the second quarter and
Chevron made a record
$11.62 billion. The sky-high
profits come one day after High gas prices are shown as a pedestrian waits to cross the
the U.K.’s Shell shattered its street in Los Angeles, June 16, 2022.
own profit record. Associated Press
Soaring energy prices have
rattled consumers and Inflation is already chang- earned $4.21 per share,
become a political flash ing where Americans go exceeding analyst expec-
point. Last month, President and what they eat. It’s also tations of $4.02 per share,
Joe Biden said that “Exxon changing the way they according to analysts
made more money than consume energy. polled by Factset. Chevron
God this year. “ Two-thirds of Americans earned $5.95 per share, ex-
Consumers are facing high changed their driving hab- ceeding analyst expecta-
fuel prices not just at the its and lifestyle, with the vast tions of $5.16 per share.
pump, but soaring energy majority choosing to drive Shares of Exxon Mobil Corp.
prices are being baked less or combine errands, jumped 4% at the opening
into delivery costs, which said AAA spokesman An- bell Friday and Chevron
is driving up the cost of ev- drew Gross. Among those rose 8%
erything from apples to toi- surveyed by AAA, 2% said Exxon CEO Darren Woods
let paper. they bought an electric ve- attributed the company’s
The record profits marked hicle since March, he said. success to its investments
a stunning turnaround from “They have really altered in oil and gas fields in Guy-
the early days of the COV- their lifestyles to cope with ana and the Permian Basin,
ID-19 pandemic, when cit- these high prices,” Gross as well as its investments in
ies were locked down and said. Exxon, based in Irving, liquefied natural gas, which
demand for fuels plum- Texas, increased its oil and has been in high demand
meted. There were numer- gas production as crude globally.
ous bankruptcies and thou- prices hovered above $100 “Given the long investment
sands of layoffs. a barrel. Revenue at Exxon cycle times, growing supply
The industry has long gone skyrocketed to $115.68 bil- will not happen overnight,”
through boom-and-bust lion, up from $67.74 billion said Woods in a confer-
cycles. during the same quarter ence call Friday.
But due to the ongoing war last year. Gasoline prices rose par-
Russia waged on Ukraine, Natural gas and liquefied ticularly quickly during the
which resulted in less oil natural gas (LNG) prices quarter, due to limited
and gas on the market are also elevated due to global supply, the high cost
from Russia, as well as other Russia’s invasion of Ukraine of oil and because there
global supply constraints, and ensuing sanctions are fewer refineries operat-
high prices could linger for against Russia, a major sup- ing in the U.S. than before
some time. plier of natural gas. Many the pandemic. Exxon plans
“It’s devastating,” said European nations have to increase refining capac-
Mark Wolfe, executive di- been scrambling for alter- ity by about 250,000 barrels
rector of the National En- natives to Russian natural per day in the first quarter
ergy Assistance Directors gas, and have been com- of 2023 by expanding its
Association, who added peting for boatloads of Beaumont Refinery. That
that high energy prices hit LNG, driving up prices for represents the industry’s
low-income families and natural gas both globally largest single capacity ad-
frontline workers the hard- and in the U.S. Inflation in dition in the U.S. since 2012,
est. “You live on a tight Europe has also been surg- the company said.
budget and this is an extra ing, including soaring costs o alleviate Europe’s energy
$40 to $50 per week.” for energy. crisis, Exxon sees potential
Wolfe wants the federal Surging prices have been for fracking and unconven-
government to tax energy a boon for investors, in- tional gas in Germany, and
companies and “redistrib- cluding energy executives “there’s an opportunity
ute some of those profits who receive a large share where certainly ExxonMo-
back to the families who of compensation through bil could play a key role,”
are struggling.” company stock. Exxon Woods said.q