February 2, 2023
Have you noticed gas prices creeping back up again?
The national average for a gallon of regular today is $3.50. That’s 29-cents a gallon higher than a month ago and 10 cents higher than a year ago. And experts say it’s very possible the price will hit $4 a gallon this year.
What is going on? There’s stuff going on with the oil supply and there’s *big* stuff going on with oil company profits.
First – the supply stuff.
According to the US Energy Information Administration as of last week the US is pumping more than 12 million barrels (12.2 million) of oil a day – that’s 600,000 more a day than we were a year ago…but it’s not enough to overcome the fact that oil prices have been going back up and US oil refineries issues are persisting from December’s winter storms and the refineries are prepare for their upcoming maintenance which slows things down too. Plus in just a few days (Feb 5) the European Union sanctions on Russian refined products kick in – and that could again strain global supply.
Now – let’s talk about oil company profits and brace yourself – these numbers are astronomical.
Exxon mobile made almost $13 billion dollars ($12.8b) in the 4th quarter – that’s October, November and December. Their annual profits reached more than $59 billion dollars ($59.1b)
Shell made almost $10 billion dollars ($9.8b) in the 4th quarter with their annual profit of almost $40 billion dollars ($39.9b)
Chevron made almost $6.5 billion dollars ($6.4b) in the 4th quarter with an annual profit of $36.5 billion dollars.
I know those numbers are really hard to put into context. So think of it this way — if we add the 2022 annual profit from these three companies – that’s $135.5 billion dollars.
For that money you could buy 1900 F-35 jets ($70 m each), more than 11,000 large private islands ($12 m each) and based on 2022 valuation – you can buy all of the NFL’s 32 teams minus the Cowboys ($143 b).
Exxon Mobile 4th quarter earnings here
Shell 4th quarter earnings here
Chevron 4th quarter earnings here
More about where we stand with the oil market right now.
