As a result of high energy prices and profitable margins for oil refining, western oil giants Exxon, Chevron and Shell were able to gain record profits of $46.2 billion in the second quarter of 2022.
Exxon’s profits rose in the second quarter of 2022 to an all-time high of $17.9 billion, which is four times the profits for the same period last year, due to higher oil and fuel production, higher energy prices and cost cuttings.
Chevron posted record profits of $11.6 billion, compared to $3.1 billion in the same period last year 2021. Despite concerns about the economic slowdown, the company continues to witness strong demand for oil and fuel, coinciding with the company’s supplies recovering by 6.5% in producing US oil and gas compared to the first half of last year.
Shell posted a second consecutive quarterly profit, with a profit of $16.7 billion based on a net current cost of supplies, a figure similar to the net income reported by US oil companies.
Since the beginning of 2022, the the value of shares of the mentioned companies have risen at record rates, Exxon shares have increased by 46% and Chevron shares by 26%, while the energy sector has grown to more than 4%.
However, many institutional investors are still reluctant to support fossil fuel companies, due to concerns about their impact on the climate and their long-term profitability, and about the transition of some countries to renewable energies. But the companies’ recent performance has made it more difficult for these investors to ignore the sector.
In general, corporate profits represent a major transformation for the industry, which has lost a lot of money since the outbreak of Covid-19 around the world in 2020, and the consequent bankruptcy of dozens of companies.
However, the cash reaped by the oil giants has become a liability for President Biden and Democrats in Congress who have asked companies to increase oil and gas production and refining capacity, in order to help lower fuel prices.