America's two biggest oil companies banked huge third-quarter profits, benefiting from the disruption in energy markets after drones took out major oil refineries in Russia and the Middle East.
The fuel-making divisions at ExxonMobil and Chevron turned in their highest quarterly earnings ever, while churning out fuel for a global market buffeted by supply disruptions. Both companies are taking steps to boost their output of diesel, prices of which hit records in the U.S. in September.
"The higher fuel prices clearly put real pressure on families and businesses, and the most meaningful response that we can make to higher global commodity prices is to pull every lever available to us to increase supply," Neil Hansen, Exxon's chief financial officer, said. "That's what we've been doing."
High profits at oil companies can sometimes draw criticism from the White House. After Exxon and Chevron reported banner earnings in July, President Trump said they should return profits to the public. His criticisms echoed those of former President Joe Biden, who accused the industry of price gouging in 2022. High fuel prices haven't yet weighed too heavily on the U.S. economy, which grew faster than economists predicted at a 3.4% annual rate in the third quarter.
The results
Exxon's earnings climbed to $15.4 billion, up 104% over the same period last year and the highest since 2022. Its adjusted per-share earnings of $4.23 beat analysts' expectations of $4.12, according to FactSet.
The oil company produced 5.8 million barrels a day of refined products globally -- while setting a record in North America -- and sent $9.4 billion to investors via dividends and share repurchases.
Chevron's profits rose to $9.9 billion, almost tripling its results from the year-earlier period. Its adjusted per-share earnings of $5.28 topped analysts' expectations of $4.87.
Its U.S. refineries processed a record 1.1 million barrels a day of crude. Rising output in Venezuela contributed to a 19% jump in international oil-production profits to $2.4 billion.
Oil refining
Both companies boosted fuel production near their utmost limits to take advantage of soaring diesel prices, while exporting record amounts of fuel.
Exxon's efforts to squeeze as much fuel as it could from its refineries brought an additional 80,000 barrels a day to the market in June and July. The company plans to invest $9 billion in its Gulf Coast facilities in coming years to raise production capacity by 100,000 barrels a day. The company's diesel output is equivalent to about 40% of Texas' demand.
Chevron fixed bottlenecks and increased capacity at two of its major refineries in Pasadena, Calif., and Pascagoula, Miss., boosting the company's yields of distillates -- effectively diesel and heating oil -- by 10%. Chevron's refining earnings in the U.S. jumped to $3.6 billion, fivefold higher than last year.
Capital plans
Despite their windfall of cash, Exxon and Chevron signaled they plan to remain conservative in their spending, cutting debt and strengthening their balance sheets.
Exxon has slashed its net debt by almost $11 billion this year; Chevron by $13.8 billion. Even as prices climbed, Chevron spent less than last year in the Permian Basin of West Texas and New Mexico, the epicenter of its American oil production, where output was flat at roughly 1 million barrels a day.
Chevron Chief Financial Officer Eimear Bonner said the company is using excess cash to pay down debt and strengthen its balance sheet, which she said was a prudent move in a highly volatile market.
"We'll spend $18 to $19 billion in the business organically this year," she said. "That's important to run the business today, but also to invest in future supply. We'll be able to do all of that with the budget we have."
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