For the fourth straight quarter, Exxon raked in $10 billion or more in profits.
Results released on Friday morning found the company detailing its best start to a year in a century and a half of corporate history.
Net income of $11.4 billion “reflects changes we’ve made,” according to CEO Darren Woods, who enjoyed a 50% raise in 2022. He expects higher oil prices in 2023.
The company’s blockbuster Q1 came on the heels of a near $13 billion haul in Q4, which was itself a rousing encore from Q3, when almost $20 billion in net income marked the most profitable quarter ever for Exxon. All told, the company’s profit in 2022 was $59 billion, a record.
Woods, who, along with Chevron chief Mike Wirth, has come under fire from the Oval Office for alleged “war profiteering,” was keen to emphasize Exxon’s efforts to increase output. “We are growing value by increasing production from our advantaged assets to meet global demand,” he said Friday.
Oil & gas CEOs are being asked to walk a tightrope between increasing production and investment in fossil fuels to offset high prices for consumers, while also facilitating the green energy transition. Implicit is an absurd capex ask: Invest in something the government is determined to eliminate.
Woods dutifully alluded to the juggling act. “At the same time, our Low Carbon Solutions team is rapidly growing this new business with an additional carbon capture, transportation and storage agreement that underscores the company’s growing momentum in providing industrial customers with large-scale emission reduction solutions,” he went on.
The whole thing is an awkward dance between shareholder capitalism, the profit motive and a Washington charade born of political expediency at a time when a Democratic president is being pulled in two directions by the threat of high pump prices and the demands of an increasingly influential Progressive movement.
Speculation that Exxon might make a big acquisition is rampant. The Wall Street Journal recently said the company has tentatively discussed buying Pioneer in what would be a “megadeal.” Exxon now has $32.7 billion in cash on hand. The company remains on track to buy back up to $17.5 billion in shares this year.
Cue the irritable White House press release.
My old enfeebled brain still remembers when Exxon changed its name (based on a computer-generated list of random letter combinations) and became the first corporation in US history to report a one billion dollar profit. Imagine that. When I started my doctoral program in 1967 the daily stock volume on the NYSE was 5-6 million shares. Imagine that. Billions a day today. The last time Exxon profits jumped like this was in the oil crisis of 1973-74. Congress had to stop this rape of the poor citizens so they passed an excess profits tax. Of, course that never worked but had a great many unintended consequences. The thing is that then, as now, our congressional and business leaders were masters of the practice of skating fast over thin ice.