Exxon Mobil, Shell Post Record Profits

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dasmi

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Exxon has a 100 billion dollar quarter.

http://www.breitbart.com/news/2005/10/27/D8DGFSKO0.html

Exxon Mobil, Shell Post Record Profits
Oct 27 12:20 PM US/Eastern
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By STEVE QUINN
Associated Press Writer

IRVING, Texas

High prices for oil and natural gas propelled Exxon Mobil Corp. and Royal Dutch Shell PLC to their best quarterly results ever on Thursday, with Exxon becoming the first U.S. company ever to ring up quarterly sales of $100 billion.

To put Exxon's performance into perspective, its third quarter revenue was greater than the annual gross domestic product of some of the largest oil producing nations, including the United Arab Emirates and Kuwait. The world's largest publicly traded oil company also set a U.S. profit record with net income of almost $10 billion, according to Standard & Poor's equity market analyst Howard Silverblatt.

Both Exxon and Shell said their performances were buoyed by higher crude-oil and natural-gas prices, even as output suffered due to a busy hurricane season in the Gulf of Mexico.

Exxon's net income ballooned 75 percent to $9.92 billion, compared with $5.68 billion a year ago. The previous oil-industry earnings record was Exxon's 2004 fourth-quarter profit of $8.42 billion. Revenue grew to $100.72 billion from $76.38 billion in the prior-year period.

At Shell, third-quarter net income attributable to shareholders grew 68 percent to $9.03 billion, compared with $5.37 billion a year earlier. Including income attributable to minority interests, profit rose 67 percent to $9.39 billion at the Anglo-Dutch company. Revenue rose 8 percent to $76.44 billion, in spite of an 11 percent decline in oil and natural gas output.

"We are capturing the benefits of high oil and gas prices and refining margins," Shell Chief Financial Officer Peter Voser said, referring to the profit margin on each barrel of crude that is refined into gasoline, diesel and jet fuel.

Excluding certain items, Exxon's profit was $8.3 billion, or $1.32 per share, or slightly below the $1.38 per share expected by analysts polled by Thomson Financial.

Shell said adjusted earnings on a current cost of supplies basis _ a measurement that strips out the fluctuating value of the company's oil and gas inventories _ was $7.37 billion, sharply higher than analysts' forecasts.

Shares of Exxon rose 56 cents, or 1 percent, to $56.76 on the New York Stock Exchange, where U.S.-traded shares of Shell rose $1.11, or 2 percent, to $60.61.

Exxon said the hurricanes slashed U.S. production volumes by 5 percent from a year ago, while global daily production slipped to 2.45 million barrels of oil equivalent from 2.51 million barrels.

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"The world's largest publicly traded oil company also set a U.S. profit record with net income of almost $10 billion"

Is this a great country or what?

Lemme check my portfolio. Yep, this is a great country. :)

John
 
Given that all this sort of stuff has been known of for several years, even separate from such things as hurricanes, the way to deal with it is to have bought stock in these corporations. And quite a few other commodity producers, as well: Cement, copper, steel, aluminum, food...

Absent going nuke, drilling in the ANWR and drilling in the "forbidden" areas of the U.S., gasoline and other energy items will continue to increase in cost.

Art
 
When you can't add refinery capacity or build new ones. When you can't drill for new supplies. When you can't do anything that supports your business and are in a business that has a ready market for your product making money is easy. The petroleum industry were run out of the Santa Barbera channel and costal areas but they still demand the products. Same story in most of the US. Get rid of the stupid feel good not in my back yard rules and see what happens. Personally I would love to have a drill field, refinery, and a nuclear generating facility where I live. They would fit right in with the large hog farm that is already here.
 
Okay, here's my thought on the oil companies conspiring against the consumer. Before the hurricanes, we were paying between 1.60 and 1.90 a gallon here in Mid-Ohio. When the hurricans came, prices rose to $3 and up per gallon of gas. It was "justified" due to the risks to the supply, the equipment, etc. Then, when things calmed down, the prices started back down. Now, it's around $2.40 a gallon, more or less depending on the day.

So, what's happened? We, the consumers, are happy to have prices back below $3 a gallon. And the oil companies? They're stuffing an extra $.50 a gallon in their pockets.

So, what do I think? I think they jacked up the prices during the concerns for the hurricanes, knowing that if the prices were reduced on the other side, no one would complain that the prices were $.50 higher than before the hurricanes, so long as they were lower that their highest prices during the hurricane scare. It was the companies capitalizing on the opportunity. They could justify the raises due to the hurricanes, then make the consumers happy by having the prices only $.50 a gallon higher than before the hurricanes. More profits! And, let's not forget the nice tax breaks they just picked up.

Makes me wish there was an alternative to paying for the gas.
 
CAS700850: +1

I advanced the exact same analysis of the situation a week or two back at the lunch table at work.

Nobody disagreed.

I haven't trusted the integrity of the oil companies since the Arab oil embargo in the early '70s when I was in high school. At that time, a classmate's father was an executive for one of the major oil companies. He said his dad was getting heat from his boss because the oil company was running out of storage capacity for the gas they were holding back from the market . . . just like all the other big companies were doing! :fire:
 
Yet furniture stores mark up the goods 100%, 150%, maybe 200% and nobody complains.

I guess when it gets too expensive to drive I'll have to walk those 6 long blocks to work. I'm kidding, I've been mostly walking it for 25 years. How else would I have a 4-year-old car with only 21k on it?

John
 
JohnBT said:
Yet furniture stores mark up the goods 100%, 150%, maybe 200% and nobody complains.

I guess when it gets too expensive to drive I'll have to walk those 6 long blocks to work. I'm kidding, I've been mostly walking it for 25 years. How else would I have a 4-year-old car with only 21k on it?

John
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Not a good comparison because furniture is not a "must have" commodity.

Gasoline (energy in general, e.g., natural gas, heating oil, electricity) is a commodity that people are virtually forced to buy as our society is built around the use of these energy sources.

If furniture is too expensive, then I just wait for another day. Not so with gasoline and such. Most people do not have mass transit available to get around or live close enough to work to walk or bike (what I wouldn't wish for that to be the case personally!).

I strongly believe in a free market system, but I'm starting to consider that it may be wise for governments to get into the energy business in order to provide a stable supply of energy and public revenue.

I fully believe that the control of our energy commodities have become too centralized amongst too few mega-corporations. Even more alarming, I also see the same thing happening (albeit at an earlier stage, but still heading in an ultimately bad direction) with food supplies.

Sawdust
 
Most people do not have mass transit available to get around or live close enough to work to walk or bike (what I wouldn't wish for that to be the case personally!).
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Unfortunately, many people made lifestyle choices (such as living in the country while working in the city) based on an unreasonable expectation that commuting costs (and time) would remain static, if they indeed ever gave commuting costs (and time) any thought at all. Now, city dwellers are likely to see their property values increase and distant country property values are less likely to increase at their previous rates as commuting costs continue to rise and home buyers are forced to factor in those costs to their budgets.
 
yeah right..and all the elderly people living in this place have an limitless supply of money too. They either pay their heating bill or choose between meds or food?its ridiculous.Ive taken food over to my neighbors because I know their situation,cant wait till I cant pay my heating bill.
 
bratch said:
Nationalizing the petroleum industry worked well for Mexico:rolleyes:
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Nowhere did I advocate nationalizing *anything*. Reading comprhension classes begin for you tomorrow morning at 8:00 sharp. ;)

My suggestion is for the consideration of governments participating in the industry. For example, the state of California could build a few of its own oil refineries and force competition.

Yes, I know how silly that sounds - having a bloated bureacracy "compete" in anything is laughable, and their is probably a myriad of current laws why this would be impossible.

But I can't help but think that there *must* be a solution to providing a constant supply of a "must-have" without society being held by the short hairs.

I am horrified by how socialistic I sound to myself...but if our society is built around the necessity of having to possess certain things (not just wanting something, but needing it to survive), then there must be, at a minimum, a system of transparent competition and no barriers to entry to new competitors.

Sawdust
 
The are hundreds of small independent oil companies. These often take over for the majors once a field becomes uneconomical.

The real bottleneck is refining. Regulations are such that building new refineries is not attractive. If the government wants to build its own refineries and try to compete go for it. They will have to roll out the big bucks for playing the game though the oil industry is extremely competitive.

The world is changing. Alot more people and nations want oil today that didn't 20 years ago. Oil companies are a for profit business and will sell to the highest buyer. High dollar technology and multi-billion dollar developments are proving oil to all of us who feel we need it to drive around the corner for a pack of smokes. When the Chinese are willing to pay a premium $$ for oil everyone has to step up to the plate or get left behind.

We are going to have to adjust our way of life going into the future. Shorter commutes, smaller houses, less comfortable climate control and less toys. People might not like it but its going to happen or they will go broke from trying to live a life that isn't possible in the current settings.
 
shares of Shell rose $1.11, or 2 percent, to $60.61.
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Yippy skippy.

I owned shares of Royal Dutch (Shell symbol RD) and sold them around 2001 for around $61/share. The fact that their share prices are roughly the same now as they were 4 years ago coupled with the fact that the stock prices have been depressed for about 3 of those years in between, probably means that the the growth in profits were needed to just get back to where they were before.

BTW, did a check on gasoline prices for 2001- they ran around $1.60- $1.70, about the lowest they've been since.


I like to tell people who think that oil companies profiteer and price gouge to get on the gravy train and buy up every share of oil stock that they can. Afterall, they are publicly traded companies, meaning publicly owned, so if they think that 'Big Oil' is doing everything they are accusing them of doing, only a fool wouldn't put their money where their mouth is.
 
"it may be wise for governments to get into the energy business"

Sounds good on the surface, but understand that gas prices were regulated by the gummint up until Tricky Dick took office-here comes the 73 embargo.

Then, the gummint decides to meddle in the early 80's-WHAMMO! There goes the prices up again!

Unless there is a miracle in our future, the government has never been economical at a single thing they have ever ran or meddled in that I can think of.

I would like to see the government get involved in R&D for alernative energy, along the lines of what they did in NACA, and the later NASA. Pumping that kind of cheese back into the public sector means jobs for the great unwashed, er, citizens.
No-its not gonna be cheap, and probably not all that efficient, but at least the tax dollars will go for something to help the country, instead of re-paving the parking lot for the Toledo Mud Hens (true) and studies on cow flatulence in Colorado (also true).

For the math majors, how many $60 hammers would it take for the Feds to build a refinery??:what:
 
Record sales of 100B, profit of 10B......10% profit, doesn't sound like price gouging to me. Factor in the damages to refineries and offshore rigs during hurricane Katrinia, 10% doesn't look so big.

Funny no one is drawing attention to the state and federal taxes on each gallon....what do these government entities have invested? Wouldn't that make their net profit about 100%
 
I'm totally against government "price controls", but I'm also against "monopolies", especially when coercion is involved!

While I realize what the "free market" is, and that it's totally legal to adjust prices for the supply and demand aspects, it P!$$E$ me off when I see a gas tanker fill the tanks of a gas station on a Monday, when the price per gallon is "X" amount, but by Wednesday, the price has gone up to "X+Y" per gallon!

Anyone remember the "good old days" of the "gas wars"? One day, when I pulled into a gas station, the attendant came out and asked me if I could wait a few minutes before HE filled my tank (Yep, that was back when station attendants did EVERYTHING for FREE!). I asked him why he wanted me to wait, and he said that they were in the process of figuring out how LOW they were going to re-set their prices!
As it turned out, a gas station across the street had adjusted their prices from 21-cents per gallon DOWN to 19-cents. The station that I was at already had it at 19-cents, but....thanks to the friendly attendant, the wait was worth it, for they dropped it down to 16-cents per gallon! I had the tank filled for a whopping $2.24, got all of the windows cleaned, oil level and tire pressure checked for FREE....and BLUE CHIP STAMPS! Heck, I think that I even splurged for a 10-cent bottle of soda! (HMM! I think that I was making a whopping $1.35 per hour at work back then!)
 
So answer me this.

Why are people bent sideways about the oil companies making 9.92 Billion, but no one says a word that Citigroup made 7.72 Billion?

I would submit that easy access to credit cards and the gouging that goes on there will do more long term damage to this country than high gasoline prices.

Where do you think the people are getting the money to buy this gas? They are putting it on their Visas, and praying they can dig out from under that some day.
 
We are going to have to adjust our way of life going into the future. Shorter commutes, smaller houses, less comfortable climate control and less toys. People might not like it but its going to happen or they will go broke from trying to live a life that isn't possible in the current settings.
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I agree, and would like to see the 'free market' and unrestrained capitalism proponents (who claim that theirs is not a zero sum game) counter that statement. Or is that group willing to admit that we are losing the middle class and instead seperating into the 'haves' and 'have-nots'?
 
TexasSIGman,

You've got a good point about the credit card industry, and its dangers. My nager towards the oil industry is generated by teh fact that they push for tax breaks from teh government due to the expenses of the business, the need to develop additional resources, etc., while turning huge profits. 10% may not sound like much, but when 10% amounts to $10,000,000,000, that's a hell of a lot of money. Me, I'm in danger of losing some "tax breaks" for the cost of repaying my student loans because I got a 2% pay raise, which will amount to $1,700 over the next year.
 
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