NEW REPORT: Oil and Gas Companies Gloat About Blockbuster Earnings
August 2, 2022 Groundwork Collaborative
Today, the Groundwork Collaborative released new research showing oil and gas executives bragging on corporate earnings calls about their record-shattering profits. Lindsay Owens, executive director of the Groundwork Collaborative, responded with the following statement:
“The data is in. As Americans hit their breaking point with high prices at the pump, Big Oil CEOs are using the crisis in Ukraine to bring in eye-popping profits. Exxon brought in $2,245 a second in the second quarter – that’s not a strong quarter, it’s a one-way racket.”
Highlights from Big Oil’s second quarter earnings calls:
- On their earnings calls, Hess executives said they planned to exploit high oil prices “to increase the return of capital to our shareholders through further dividend increases and share repurchases.”
- Hess Corporation’s CFO said that despite inflation and supply problems increasing costs, “with the higher oil prices, obviously, we’re getting much higher returns in cash flow.”
- Shell executives admitted that high prices weren’t simply because of the war or inflation: “while indeed the war is a driver of a lot of the pricing that we are seeing,” their profits were not merely a “windfall because there happens to be a war on the continent here.”
- Shell’s CEO said the company’s earnings were up 65% from the last time the average price of oil was $108 and “this quarter our cash distributions were the highest ever.”
- Shell’s CEO said the company had 21% less production than in 2013 but had almost doubled what it made per barrel: “…yes, energy prices are very high today, but they have been so before. And the real difference is that today we are performing much better in a similar price environment…So we are increasing our shareholder distributions at a $6 billion share buyback program for the next quarter.”
- Chevron emphasized it was not seeking to increase production significantly, but was “focused on generating returns.”
- Chevron downplayed inflation and recession costs, saying the company was focused on “more free cash flow for shareholders.”
- Chevron told analysts it plans to increase stock buybacks to $15 billion per year.
- Phillips 66 said that supply constraints were “supporting elevated refining margins,” leading to earnings over $3 billion.
- A Phillips 66 executive said their refining income was $3.1 billion, “up from $140 million in the first quarter” and said, “Realized margins increased by 168% to $28.31 per barrel.”