ExxonMobil, the US energy giant, reported a record first-quarter profit of $11.4bn in 2022. This is more than double the company’s profit for the same period last year, which was $5.5bn.
The increase in profits is attributed to the rising demand for oil and gas and cost-cutting measures. The firm’s strong production growth, driven by new offshore developments and refining facilities, was also a significant contributor to the better-than-expected earnings.
ExxonMobil also announced that shareholders would receive $8.1bn, including dividends and $375m in share buybacks. Despite lower oil prices and a $200m hit from windfall taxes in Europe, ExxonMobil’s profits increased.
The company has been criticised for its returns to shareholders amid high oil and gas prices. ExxonMobil is currently involved in a legal dispute with the European Union over a new windfall tax on oil companies.
ExxonMobil’s Q1 profits soared to a record $11.4bn, more than double compared to last year, due to higher demand for oil and gas, along with cost-cutting measures.
Despite the falling oil prices and paying $200m in windfall taxes in Europe, ExxonMobil reported a significant increase in profits for the first quarter of the year. Its rival, Chevron, also reported a rise in profits.
Chevron reported a 5% rise in profits to nearly $6.6bn for the first quarter, including a $130m “energy profits levy” in the UK. Meanwhile, Shell and BP are scheduled to release their latest results next week.
Exxon, along with other major energy companies, has been criticized for the amount of money it has given back to shareholders during a period of high oil and gas prices.
ExxonMobil announced that shareholders would receive $8.1bn, which includes dividends and $375m in share buybacks. The company also revealed that its increased profits included a $3.4bn after-tax reduction to exit Russia.
ExxonMobil’s CFO, Kathryn Mikells, told Reuters that the company achieved a record first-quarter profit despite the softening of energy prices and refining margins.
According to chief financial officer Kathryn Mikells, the main reason for the better-than-anticipated profits was due to robust production growth from newly launched offshore projects and refining facilities.
Exxon is presently embroiled in a legal battle with the European Union, as it seeks to challenge the bloc’s recently introduced windfall tax on oil companies.
Exxon, along with other players in the sector, has accused Brussels of exceeding its legal authority and argued that the EU’s new windfall tax on oil firms would discourage investment and is counter-productive.
Exxon’s oil and gas production, which was the highest since 2019, exceeded expectations, according to industry analyst Peter McNally at Third Bridge research firm.
According to industry analyst Peter McNally from Third Bridge research firm, Exxon’s oil and gas production surpassed expectations, with the highest output since 2019. However, the collapse in US natural gas prices brought down profitability, while the refining business remained strong, delivering over $4bn in earnings for the fourth consecutive quarter.
Source : bbc.com