Exxon and Chevron hit record $100 billion in revenue in 2022

Rising oil and gas prices will lead to record profits in 2022 for the two US supermajors, Exxon and Chevron, and their annual profits will be around $100 billion, according to analysts.

The two oil and gas giants have benefited from rising oil and gas prices following Russia’s aggression against Ukraine. Although oil prices traded below $90 a barrel in the final weeks of 2022, and prices rose only 10% year-on-year last year compared to 2021, the extreme volatility and frequent spikes above $100 are a concern for all oil companies. , including the biggest oil companies. America’s integrated companies generate record or near-record quarterly profits and cash flows.

Exxon and Chevron’s annual earnings are also expected to hit record highs. Exxon will post $56 billion in profits by 2022, while Chevron’s profits are projected to exceed $37 billion, according to estimates compiled by S&P Capital IQ. Financial Times.

The supermajors’ record quarterly earnings drew repeated criticism from President Joe Biden and his administration officials, who slammed the company’s strategies to increase share buybacks and boost dividends. American consumers.

After Russia’s invasion of Ukraine, Exxon and Chevron’s quarterly earnings were already pointing to record annual profits for 2022.

Chevron announced its highest quarterly profit for the year second quarter, driven by multi-year high refining margins thanks to high oil and gas prices and tight fuel markets. For the 3rd quarter, Chevron posted its second-highest quarterly profit ever, thanks to increased oil and gas demand and increased production in the US. Exxon ordered It earned $19.66 billion for the third quarter, surpassing its previous record of $17.9 billion in bookings for the previous quarter. Related: Gazprom eyes fast-growing Chinese market as exports drop 50%

Chevron “on track to beat 2022 free cash flow record” from 2021, CFO Pierre Breber he said In the Q3 earnings call in October.

Chevron he said Its organic capital for 2023 will be $14 billion for 2023, in line with its “long-term plans to safely deliver higher income and lower carbon,” Chairman and CEO Mike Wirth said last month.

“Even with inflation, our capital budget remains in line with previous guidance,” Wirth said. “We are winning back investors with efficient capital growth, a strong balance sheet and greater returns to shareholders.”

Exxon’s corporate plan through 2027, too opened in December, keeping annual capital spending at $20-25 billion, while increasing low-emissions investments to about $17 billion. In 2023, investments are expected to be in the range of 23-25 ​​billion dollars to increase supply to meet global demand.

“We view our success as an equation of ‘and’ where we can produce the energy and products that society needs — and — we can be a leader in reducing greenhouse gas emissions from our own operations as well as from other companies,” he said. CEO Darren Woods.

Even as they invest in clean energy solutions, both supermajors say they will continue to supply oil and gas because the world will run on fossil fuels for years and decades to come.

The strategy has been criticized by both environmentalists and the White House. Activists accuse the oil majors of greenwashing, and the Biden Administration accuses They threaten windfall taxes on “war profit” companies and those who don’t invest in American supplies.

In October, President Biden said that if oil companies do not invest in increasing production and refining capacity, “they will pay higher taxes on their excess profits and face other restrictions.”

With Fall in gasoline prices in the United States In recent weeks, the rhetoric of blaming the oil industry has been tempered by the Administration taking credit for falling prices at the pump.

On several occasions, the American Petroleum Institute (API) has issued statements following criticism of the Biden Administration. API President and CEO Mike Sommers in late October he said“Instead of taking credit for price declines and shifting blame for price increases, the Biden administration should get serious about addressing the supply-demand imbalances that are driving higher gas prices and creating long-term energy problems.”

“Oil companies do not set prices, global commodity markets do. Increasing taxes on American energy discourages investment in new production, which is the exact opposite of what is needed.”

By Tsvetana Paraskova for Oilprice.com

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