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Exxon Mobil
Corp.
XOM 1.65%
and
Chevron
Corp.
CLC 3.62%
Each of them recorded its highest third-quarter profits in four years, as the world's largest oil companies finally seemed to have gotten rid of a slump in a stock market crash that has lasted for several years.
Exxon's net earnings increased 57% to $ 6.24 billion, as a result of improved operations that allowed it to benefit from higher drilling prices and higher refining margins. Chevron's profits doubled to $ 4 billion.
Both companies exceeded expectations and rebounded on Friday, following the performances of almost all the world's largest Western energy companies. BP PLC, French company
Total
HER
and Norway
Équinor
AS
EQNR 0.59%
A all behaved well with investors last week after exceeding earnings forecasts.
Large oil companies saw their profits plummet as a result of a drop in world oil prices that began in 2014 and lasted several years. But prices have picked up this year and corporate profits have risen sharply in the third quarter.
Investors had been disappointed with the performance of Exxon and Chevron over the past year. Before today, stock prices of companies had fallen about 4% over the last 12 months, even as oil prices had risen by about 30%, reflecting the disappointment of some shareholders. Exxon in particular had encountered operational difficulties and its quarterly production from April to June had reached its lowest level in a decade.
The company said it had solved these problems and that production reached about 3.8 million barrels a day, a slight decrease from the previous year.
"Operational performance has improved significantly compared to the second quarter, with lower scheduled maintenance and lower reliability, consistent with our expectations," said Exxon CEO Darren Woods.
Chevron's production set a record of about 2.9 million barrels a day, taking into account new production from Australia's leading natural gas export projects and growth in North America.
"Our strong financial results reflect the increase in crude oil production and prices, coupled with a constant focus on efficiency and productivity," said Chevron General Manager Michael Wirth.
Exxon and Chevron have continued to intensify their activities in the Permian Basin in Texas and New Mexico, one of the hottest oil fields in the world. Exxon now has 38 operating platforms in the region, and the company's shale production unit recorded its third consecutive quarterly profit.
Profit margins also increased in the refining sector for Exxon. The company was able to buy crude in parts of the United States and Canada that were selling at a discount because it was landlocked after production exceeded pipeline capacity.
-Allison Prang contributed to this article.
Write to Bradley Olson at [email protected]
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