
Gas costs are displayed at a Mobil gasoline station in Los Angeles on Oct. 28, 2022. ExxonMobil posted record earnings in 2022, benefitting from a surge in oil costs.
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Gas costs are displayed at a Mobil gasoline station in Los Angeles on Oct. 28, 2022. ExxonMobil posted record earnings in 2022, benefitting from a surge in oil costs.
Mario Tama/Getty Images
ExxonMobil earned practically $56 billion in revenue in 2022, setting an annual record not simply for itself however for any U.S. or European oil big.
Buoyed by excessive oil costs, rival Chevron additionally clocked $35 billion in profits for the 12 months, regardless of a disappointing fourth quarter.
Energy firms have been reporting blockbuster profits since final 12 months, after Russia’s invasion of Ukraine despatched oil costs sharply larger.
“Of course, our outcomes clearly benefited from a good market,” CEO Darren Woods instructed analysts, nodding to excessive crude costs for a lot of 2022.
But he additionally gave his firm credit score for having the ability to make the most of these costs. “We leaned in when others leaned out,” he stated.
‘More cash than God’
The excessive profits have additionally revived perennial conversations about how a lot revenue is too a lot revenue for an oil firm — particularly as urgency over the necessity to gradual local weather change is mounting all over the world.
Exxon’s blockbuster earnings, announced Monday, will probably lead to extra political stress from the White House. Last 12 months President Biden known as out Exxon for making “more cash than God.”
The White House and Democrats accuse oil firms of hoarding their profits to enrich shareholders, together with executives and staff, as an alternative of investing the cash in extra manufacturing to ease costs on the gasoline pump.
Last 12 months, between dividends and share buybacks, Exxon returned $30 million to shareholders, whereas Chevron paid out greater than $22 billion. Exxon plans to maintain manufacturing flat in 2023, whereas Chevron plans to improve manufacturing by 0 to 3%.
Monster profits are again
If you do the mathematics, Exxon made some $6.3 million in revenue each hour final 12 months — greater than $100,000 each minute. That places Exxon up with the Apples and the Googles of the world, with the sort of extraordinary profits most firms may by no means dream of incomes.
Or relatively, it places Exxon again up in that rarefied territory. Exxon used to be the biggest firm in the world, reliably clocking huge profits.

ExxonMobil CEO Darren Woods speaks throughout a press convention in Doha, Qatar, on June 21, 2022. Exxon is going through political warmth from the White House, which desires Big Oil to use their profits to improve manufacturing additional.
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ExxonMobil CEO Darren Woods speaks throughout a press convention in Doha, Qatar, on June 21, 2022. Exxon is going through political warmth from the White House, which desires Big Oil to use their profits to improve manufacturing additional.
Karim Jaafar/AFP by way of Getty Images
In 2020, when the pandemic triggered a crash in oil costs, power firms took enormous losses. Exxon recorded an annual lack of $22 billion, its first loss in a long time. It was, humiliatingly, dropped from the Dow Jones.
A tiny upstart investor group known as Engine No. 1 challenged Exxon’s administration, accusing the corporate of not transferring quick sufficient to modify to a world getting ready to cut back its use of oil.
In this David vs. Goliath showdown, David received the battle, with Engine No. 1’s nominees changing three Exxon board members. But Goliath is not going anyplace.
Profits immediate scrutiny, criticism
Whenever oil firms are thriving, suspicions that they’re basically profiteering usually are not far behind.
Those accusations have turn into particularly charged as a result of Russia’s invasion of Ukraine have been central to the drive-up in crude oil costs final 12 months. Europe has imposed windfall taxes on power firms, clawing again 33% of “surplus profits” from oil and gasoline firms to redistribute to households.
Exxon has sued to block that tax, which it estimates would value round $1.8 billion for 2022.

President Biden delivers remarks on power as Secretary of Energy Jennifer Granholm listens throughout an occasion in the Roosevelt Room of the White House in Washington, D.C., on Oct. 19, 2022. Biden has threatened oil firms with a “larger tax on their extra profits” and different restrictions if they do not make investments their windfall earnings in extra manufacturing.
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President Biden delivers remarks on power as Secretary of Energy Jennifer Granholm listens throughout an occasion in the Roosevelt Room of the White House in Washington, D.C., on Oct. 19, 2022. Biden has threatened oil firms with a “larger tax on their extra profits” and different restrictions if they do not make investments their windfall earnings in extra manufacturing.
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Meanwhile, in the U.S., California is considering a similar windfall tax. President Biden has threatened oil firms with a “larger tax on their extra profits” and different restrictions if they do not make investments their windfall earnings in extra manufacturing. But it is unclear whether or not the administration can observe by on such a menace.
On Tuesday, the White House issued an announcement excoriating oil firms for “selecting to plow these profits into padding the pockets of executives and shareholders.”
Investors, in the meantime, aren’t complaining. They continue to pressure companies to return extra profits to buyers and spend comparatively much less of it on drilling.
“Lower-carbon” ambitions
Both Exxon and Chevron emphasised their carbon footprints in their earnings calls, a serious shift from the not-so-distant previous, when oil firms uniformly denied, minimized or ignored local weather change when speaking to buyers.
But their responses to local weather change deal with decreasing the emissions from oil wells and pipelines, or making investments in “lower-carbon” applied sciences like hydrogen and carbon seize — not on a fast transition away from fossil fuels, as local weather advocates say is important.