ExxonMobil had a record year in 2022, reporting its highest-ever profit fueled by rising oil prices.
The biggest U.S. oil company announced record annual earnings of $55.7 billion this week after releasing its fourth-quarter earnings report. The figure is over $10 billion higher than the company’s previous record earnings year in 2008.
Of all the companies that have reported earnings in the fourth quarter thus far, only tech giants Apple and Microsoft delivered higher profits in fiscal 2022, according to The Wall Street Journal.
ExxonMobil has mounted a remarkable recovery after suffering its first annual loss in over 40 years in 2020 when the price per barrel briefly reached the negatives. The year was so bad for the company that it was kicked out of the Dow Jones Industrial Average after being a staple in the index for nearly 100 years.
Last year was a much different story for ExxonMobil, with its stock price gaining around 80% on the year, the fourth best performer in the S&P500, after the Russian invasion of Ukraine drove the national average of oil to about $5 per gallon. The company also benefited from a surge in oil demand after global economies started to recover from the pandemic, according to The WSJ.
ExxonMobil CEO Darren Woods noted on the fourth quarter earning’s call that his company’s continued investment in oil at a time when competitors cut back spending has the company well-positioned for the future.
“We leaned in when others leaned out,” Woods said.
“We will continue to invest in our advantaged projects to deliver profitable growth. Help meet society’s growing needs, and reduce emissions in our operations, while providing innovative solutions that help others reduce theirs.”
In good news for Texas, the chief executive highlighted ExxonMobil’s investments in Guyana and the Permian Basin, as the top growth driver’s in oil production, with both regions boosting output by over 30% in the last year.
Woods also cited the recent completion of ExxonMobil’s $2 billion Beaumont, Texas facility expansion that launched with an initial startup of 250,000 barrels per day, as previously reported by The Dallas Express. ExxonMobil’s total oil output rose 100,000 barrels per day to 3.8 million, according to the Guardian.
In Q4, ExxonMobil recorded $12.8 billion in profits, up $3.9 billion year-over-year, but saw a sequential decline after the company reported a whopping $19.7 billion in the third quarter. Still, the company missed consensus earnings estimates, which led to an initial share price drop, but it has since recovered and is trading up 1.6% at the time of publication.
The oil industry is picking up steam, with Chevron also reporting record profits of $35.5 billion in 2022. The oil industry has been the best-performing sector in the S&P500 in the past year.
The oil industry’s record profits have drawn criticism from Washington, with Joe Biden calling out ExxonMobil last June, saying in a speech that the company “made more money than God,” according to Fox Business.
The White House also expressed displeasure about oil companies funneling their profits back to shareholders through share buybacks and delaying increased output to drive down oil prices.
“Companies clearly have everything they need – record profits and thousands of approved permits – to increase production,” White House spokesperson Abdullah Hasan said last week in a statement.
“The only thing getting in the way is their own decision to keep plowing windfall profits into the pockets of executives and shareholders instead of using them to boost supply.”
ExxonMobil said it bought back $14.9 billion in shares in 2022. The company also increased and extended its share repurchase program with up to $35 billion in cumulative buybacks in 2023-2024, the company said in a press release.
Oil and gas industry veteran Richard Welch told The Dallas Express that ExxonMobil’s record profits result from President Biden’s policies.
“Because of the Biden administration’s disastrous anti-oil and gas policies, reducing the market supply via pipeline closures, lease cancellations, as well as offshore drilling bans coupled with post-Covid demand created the perfect recipe for record profits,” Welch explained.
“ExxonMobil has diversified its portfolio to tackle all areas of the energy market to increase profits. Wind, solar, alternative fuels, and petroleum to capture all energy-related methods can be found at ExxonMobil.”
Government involvement in any industry artificially creates winners and losers. In this case, Biden’s idiotic closure of pipelines and limiting drilling on federal lands increased the price of oil, while cost of production did not go up commensurately. Big Oil’s increased profits are directly attributable to his actions.
At the same time, the government threw BILLIONS at worthless renewables and subsidized most EV purchases creating anomalies in both markets.
State of Texas over the last several years has
subsidized “green” energy to the tune of $19
billion. All we got for that are frozen wind turbines and ice covered solar panels.
Please get government know nothings out of industry.