Oil Giants Post Record Profits as Diesel Costs Soar for Drivers

The price of diesel jumped 71% over the past year to reach $6.32 per gallon, a record high that has strained budgets for families and businesses. Regular gasoline also rose 38% during the same period. These increases coincide with quarterly earnings reports from major oil producers that far exceeded Wall Street forecasts.

ExxonMobil reported that its net income more than doubled in the third quarter to $3.72 per share. On an adjusted basis, the company posted a profit of $4.23 per share, surpassing the average analyst estimate of $4.12. Revenue for the three months ended in September climbed 33% to $113.16 billion. The company attributed its performance to strong production in Guyana and the Permian Basin, as well as record utilization at its U.S. Gulf Coast refineries.

Chevron, the second-largest U.S. oil company, earned $9.9 billion, or $5.06 per share, during the same period. Its revenue surged 36% to $67.8 billion. The Houston-based firm set production records at its assets in the Eastern Mediterranean and Australia. Chevron also began including one month of results from its operations in Venezuela, where it announced a $7 billion investment plan over the next five years last month.

Higher global oil prices fueled the earnings growth. Both Brent crude and U.S. benchmark crude traded above $100 per barrel on Friday. The conflict in Iran has disrupted shipping through the Strait of Hormuz, a route that previously carried a fifth of the world's oil and natural gas. The U.S. and other G7 nations announced plans to release 100 million barrels of oil and fuel products to stabilize markets, following a larger international commitment of 426 million barrels in March.

ExxonMobil Chairman and CEO Darren Woods stated that investments in refinery expansions have increased distillate production by approximately 40% since 2019. The company raised its quarterly dividend to $1.07 and established a $20 billion stock buyback plan. Chevron Chairman and CEO Mike Wirth noted that the firm signed agreements to cut Bakken midstream costs by about 50%. Chevron expanded its holdings in North Dakota and Montana after acquiring Hess Corp for $53 billion last year.

Stock prices reflected the strong financial results. ExxonMobil shares rose 1.3% in morning trading, extending a 64% gain over the past 12 months. Chevron stock climbed 1.8% on the same day. The surge in earnings occurs as state officials implement gas tax holidays and other measures to mitigate rising fuel costs for consumers ahead of the U.S. midterm elections.