News wire — Chevron Corp on Friday posted its highest quarterly profit in eight years on surging oil and gas prices, higher output and a recovery in motor fuel demand that boosted refining margins, according to Reuters.
The strong results came a day after U.S. lawmakers grilled top executives of major oil companies over the industry’s past dismissals of climate warming and for funding groups that oppose a shift from fossil fuels.
Chevron’s earnings reflect, in part, gains from higher demand after the industry’s deep production cuts last year during the pandemic and production increases.
The company posted net income of $6.11 billion, compared with a loss of $207 million a year ago, on sales of oil that fetched nearly twice as much as a year ago and U.S.-produced gas that sold for three times as much.
Reuters also reported that Exxon Mobil on Friday pledged to revive a share repurchase program next year as its earnings outlook improved on quarterly results that topped analysts’ estimates.
The largest U.S. oil producer posted an adjusted profit of $1.58 a share, beating the Refinitiv estimate by two cents, with results lifted by oil and gas prices that have more than doubled in the past year.
Third-quarter results reflected the highest refining profit in at least two years, soaring natural gas prices and energy shortages that pushed oil to a three-year high. Crude prices have continued to climb to a near seven-year high.
Shares were up 1% at $64.94 in mid-morning trade.
All of the company’s three businesses delivered higher returns from past cost-cutting restructurings and as the global economy emerges from the coronavirus pandemic, Chief Executive Darren Woods said.
The benefits of those changes “are manifesting themselves,” Woods told analysts on a conference call, adding Exxon expects to “deliver the same growth in earnings and cash flow as our pre-pandemic plans” for $30 billion in annual profit by 2025.
Profits in oil and gas soared on the strength of international demand, reaching nearly $4 billion compared with a $383 million loss a year ago. Chemical profits slipped from last quarter’s high but more than tripled from the same period last year.
A day after Exxon’s Woods appeared before Congress to address the company’s previous dismissal of global warming, Exxon said it plans to spend $15 billion to cut its carbon emissions between 2022 and 2027.
As for Chevron, shares were up 2% at $115.37 in pre-market trading and have gained more than a third this year. Adjusted earnings per share of $2.96 handily exceeded Wall Street’s estimate of $2.21, according to Refinitiv IBES data.
Cash flow from operations, a closely watched measure, was $8.5 billion in the quarter, “the best ever reported by the company,” Chief Executive Michael Wirth said in a statement.
Overall production rose on the firm’s acquisition of Noble Energy and more production from OPEC partners, Wirth said. It would have been stronger if not for maintenance shut-ins at Kazakhstan’s giant Tengiz field.