Oil and gas company earnings have been rolling out at a breakneck pace, with oil majors Exxon Mobil and Chevron both reporting at the end of last week.
Oil companies skated through the second quarter enjoying relatively high oil prices. That could change for the current quarter. As of this morning, oil prices are at their lowest level since January on fears of a recession. Brent is trading around $76.05 a barrel, while U.S. West Texas Intermediate futures are around $72.75 a barrel.
U.S. oil major Exxon Mobil saw a $9.2 billion second-quarter profit and raised its oil output target. The company got a lift from its acquisition of Pioneer Natural Resources, while its profits from pumping oil and gas were up some 25% from a year ago to $7.1 billion.
Results mirrored profit beats by rivals including ConocoPhillips and Shell.
Exxon’s earnings from gasoline and diesel were off 32% to $946 million. Other companies, including BP, have also seen weaker refining results. The British major still topped analysts’ expectations, as stronger oil prices and retail earnings offset the impact from its refining business.
Chevron last week missed analysts forecast by 38 cents, with earnings off 19% to $2.55 per share. CEO Mike Wirth blamed some operational issues, as well as other discrete items.
The company also discounted the possibility of closing its $53 billion acquisition of Hess Corp until before mid-2025, news that sent its shares down 3%. Its shares suffered the biggest drop in 20 months on Thursday amid revelations of new delays in the proposed deal, Gary McWilliams reported.
In other corners of the energy universe, LyondellBasell on Friday topped Wall Street estimates and said it was benefiting from cheap natural gas prices, which have fallen some 21.7% this year.
Those softer natural gas prices – the U.S. Henry Hub benchmark is trading under $2 per million British Thermal Unit – aren’t good for everyone.
Shale producer Coterra Energy missed analysts estimates last week, due to those softer gas prices. Its natural gas production declined during the quarter.
