Chevron (CVX) posted much stronger-than-expected second quarter earnings Friday as a surge in global crude prices, powered in part by Russia's war on Ukraine, boosted the group's top and bottom line.
The group also lifted the upper end of its annual share buyback range to $15 billion, up $5 billion from its prior estimate, while leaving its dividend schedule unchanged.
Chevron said adjusted earnings for the three months ending in June came in at $5.82 per share, up more than three-fold from the same period last year and well ahead of the Street consensus forecast of $5.10 per share.
Group revenues, the company said, surged 82% from last year to $68.76 billion, smashing analysts' estimates of a $59.3 billion tally.
West Texas Intermediate crude prices traded around $98 per barrel over the three months ending in June -- with a spike to as high as $120 -- a range that was around 65% higher than the pandemic recovery levels recorded over the same period last year. Domestic U.S. gas prices were also notably higher, hitting an all-time peak of $5.107 per gallon in early June.
“We more than doubled investment compared to last year to grow both traditional and new energy business lines,” said CEO Mike Wirth. “With Permian production more than 15% higher than a year ago and now as one of the leading renewable fuel producers in the United States, Chevron is increasing energy supplies to help meet the challenges facing global markets."
Chevron shares were marked 6.9% higher in pre-market trading immediately following the earnings release to indicate an opening bell price of $160.66 each.
Last month, President Joe Biden criticized big U.S. oil and gas companies for taking in record profits during an American energy crisis, alleging that "high refinery profit margins being passed directly onto American families" during a "time of war".
"The crunch that families are facing deserves immediate action," Biden wrote in the draft of a letter to oil refiners. "Your companies need to work with my Administration to bring forward concrete, near-term solutions that address the crisis."
U.S. refining capacity, however, is near it 2020 peak of 19 million barrels per day, and expansion remains difficult given the lag-time of new investment and the challenging environmental standards required to erect new facilities.
Rival Exxon Mobile (XOM) also smashed second quarter earnings forecasts Friday, even amid a softer-than-expected total revenue tally, as profit margins swelled amid the year-on-year surge in global crude prices.
Exxon said adjusted earnings for the three months ending in June were pegged at $4.21 per share, or $17.85 billion, up more than three fold over the same period last year but significantly north of the Street consensus forecast of $3.74 per share Adjusted earnings were pegged at $2.07 per share.
Group revenues, Exxon said, surged 70% to $115.8 billion, missing analysts' estimates of a $132.7 billion tally.
