“These solid results across our businesses were driven by higher commodity prices and a continued focus on operations and business fundamentals,” said Darren W. Woods, chairman and chief executive officer.
“Our job is to grow long-term value by investing in our integrated portfolio of opportunities that succeed regardless of market conditions.”
During the second quarter, Upstream earnings rose substantially to $1.2 billion as realizations increased. Downstream results grew 68 percent to $1.4 billion on improved refining margins and higher refinery volumes.
Chemical earnings were $985 million, $232 million lower than a year ago, primarily due to higher turnaround activities, lower volumes, and decreased margins.
Upstream volumes declined 1 percent to 3.9 million oil-equivalent barrels per day compared with a year ago largely due to lower entitlements, while increases from projects and work programs more than offset the impacts of field decline.
Second Quarter 2017 vs. Second Quarter 2016
Upstream earnings were $1.2 billion in the second quarter of 2017, up $890 million from the second quarter of 2016. Higher liquids and gas realizations increased earnings by $890 million. Lower liquids volume and mix effects decreased earnings by $260 million due to lower sales from timing of liftings. Higher gas volumes and mix effects increased earnings by $120 million. All other items, including lower expenses, increased earnings by $140 million.
On an oil-equivalent basis, production decreased 1 percent from the second quarter of 2016. Liquids production totaled 2.3 million barrels per day, down 61,000 barrels per day as field decline and lower entitlements were partly offset by increased project volumes and work programs. Natural gas production was 9.9 billion cubic feet per day, up 158 million cubic feet per day from 2016 as project ramp-up, primarily in Australia, was partly offset by field decline and lower demand.
U.S. Upstream results were a loss of $183 million in the second quarter of 2017, compared to a loss of $514 million in the second quarter of 2016. Non-U.S. Upstream earnings were $1.4 billion, up $559 million from the prior year period.
Downstream earnings were $1.4 billion, up $560 million from the second quarter of 2016. Higher margins increased earnings by $220 million, while favorable volume and mix effects increased earnings by $90 million. All other items increased earnings by $250 million, including asset management gains, favorable foreign exchange impacts, and lower turnaround expenses. Petroleum product sales of 5.6 million barrels per day were 58,000 barrels per day higher than last year’s second quarter.
Earnings from the U.S. Downstream were $347 million, down $65 million from the second quarter of 2016. Non-U.S. Downstream earnings of $1 billion were $625 million higher than prior year.
Chemical earnings of $985 million were $232 million lower than the second quarter of 2016. Weaker margins decreased earnings by $40 million. Volume and mix effects decreased earnings by $50 million. All other items decreased earnings by $140 million primarily due to higher turnaround expenses. Second quarter prime product sales of 6.1 million metric tons were 190,000 metric tons lower than the prior year.
U.S. Chemical earnings of $481 million were $28 million lower than the second quarter of 2016. Non-U.S. Chemical earnings of $504 million were $204 million lower than prior year.
Corporate and financing expenses were $204 million for the second quarter of 2017, down $432 million from the second quarter of 2016 mainly due to favorable tax items.