Full story: Oil company profits boom as Americans reel from high fuel prices
The US’s biggest oil companies pumped out record profits over the last few months as Americans struggled to pay for gasoline, food and other basic necessities.
On Friday, ExxonMobil reported an unprecedented $17.85bn (£14.77bn) profit for the second quarter, nearly four times as much as the same period a year ago, and Chevron made a record $11.62bn (£9.61bn). The sky-high profits come one day after the UK’s Shell shattered its own profit record.
Soaring energy prices have rattled consumers and become a political flashpoint. “We’re going to make sure everybody knows Exxon’s profits,” Joe Biden said in June.
“Exxon made more money than God this year.”
The record profits came after similarly outsized gains in the first quarter when the largest oil companies made close to $100bn in profits.
High energy prices are one of the major factors driving inflation to a four-decade high in the US. Gas prices have fallen slightly in recent weeks but are now averaging $4.25 a gallon across the US, more than $1 a gallon higher than a year ago.
Consumers are facing high fuel prices not just at the pump. Soaring energy prices are being baked into delivery costs, which is driving up the cost of everything from apples to toilet paper.
Here’s the full story:
Closing summary
Time for a recap...
Two more oil giants have smashed profit records for the last quarter, thanks to the surge in energy prices following the Ukraine war.
ExxonMobil made a net profit of $17.8bn, beating forecasts, while Chevron’s quadrupled its earnings to $11.6bn.
That follows record results at Shell yesterday, just as UK families are warned that average bills will soar this winter.
Charities have warned that some of the most vulnerable households could miss out on the £400 to help with soaring energy bills this autumn:
Energy costs have helped to push inflation in the euro area to a new record high of 8.9% this month.
The eurozone did grow faster than forecast, though, with GDP rising 0.7% in Q2 thanks to a strong recovery in Spain, Italy and France.
Germany stagnated, though, leading to warnings of a winter recession.... as energy-saving measures are brought in.
Portugal’s economy shrank, though, after a strong start to the year. GDP also fell in Latvia and Lithuania as the Ukraine war caused economic disruption.
Struggling UK families have turned to credit to pay their bills, with credit card borrowing jumping at the fastest rate since 2005.
Jane Tully, the director of external affairs and partnerships at the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said the figures were “a warning sign that for some the pressure is already beginning to tell”.
The UK’s summer of industrial unrest continues, with workers at BT holding their first strike in 35 years.
Rail services will be severely disrupted on Saturday because of a strike by train drivers.
Global stock markets are on track for their best month since late 2020, as investors shake off fears over rising interest rates.
In London, the FTSE 100 index is up 83 points, or 1.1%, at a seven-week high.
In other news...
Suppliers to the online fashion retailer Missguided are expected to be paid less than 2% of the £30m owed to them by its main trading entity after the company collapsed in May.
The UK government is in line for a £1bn payout from its near-50% stake in NatWest Group despite a dip in the bank’s second-quarter profits and “uncertainty” over the UK’s economic outlook.
The Competition and Markets Authority has launched an investigation into whether eco-friendly and sustainability claims made by the fast fashion chains Asos, Boohoo and George at Asda constitute greenwashing.
Aston Martin, James Bond’s carmaker, saw pre-tax losses crash to £285.4m for the first half of this year as supply chain shortages hit production, leaving hundreds of its supercars unfinished.
TikTok has said it refused an attempt by the Chinese government to open a disguised account on the platform for the purpose of spreading propaganda.
And British Airways has returned to profit for the first time since the start of the pandemic, with its owner International Airlines Group saying demand was strong despite “historic challenges” still facing the industry.
Have a lovely weekend, we’ll be back on Monday. GW
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