Friday, October 28, 2005

Exxon, Shell net record profits

Largest publicly traded oil company earns nearly $10 billion in third quarter, with rival posting $9 billion.

By Steve quinn / Associated Press

Donna McWilliam / Associated Press Lee Raymond is chairman and CEO of Exxon Mobil Corp., which earned nearly $10 billion in the third quarter. Comment on this story Send this story to a friend Get Home Delivery

DALLAS -- Exxon Mobil Corp. rewrote the corporate record books Thursday as the oil company's third-quarter earnings soared to almost $10 billion and it became the first public company ever with quarterly sales topping $100 billion. Anglo-Dutch competitor Royal Dutch Shell PLC wasn't far behind, posting a profit of $9 billion for the quarter.

Those results led Democrats in Congress to demand a new windfall profits tax. "Big oil behemoths are making out like bandits, while the average American family is getting killed by high gas prices, and soon-to-be record heating oil prices," Sen. Chuck Schumer, D-N.Y., said in a statement.

But Energy Secretary Samuel Bodman said President Bush opposes such a move and is instead considering a wide range of proposals to help cushion consumers, including the creation of an emergency reserve of gasoline and other refined products.

Thursday's outsized earnings are a result of surging oil and natural gas prices that pushed pump prices to record territory after Hurricane Katrina. They come on the heels of similar eye-popping gains reported this week by BP PLC, ConocoPhillips Inc. and Marathon Oil Corp. Chevron Corp. reports its earnings today.

Exxon Chairman and CEO Lee R. Raymond did not mention of the record results in the company's earnings release. Instead, he noted that the world's largest publicly traded oil company "acted responsibly in pricing at our company operated service stations, and we also encouraged our independent retailers and distributors to do the same."

To put its performance into perspective, Exxon's revenue for the three-month period was greater than the annual gross domestic product of some of the largest oil-producing nations, including the United Arab Emirates and Kuwait -- even though it lost considerable production because of a string of hurricanes that battered the U.S. Gulf coast.

At Shell, third-quarter net income grew 68 percent to $9.03 billion from $5.37 billion a year earlier. Revenue at the London-based company, which has extensive operations in the United States, rose 8 percent to $76.44 billion.

Shells profits from exploration and production increased by $2.6 billion to $5 billion in spite of an 11 percent decline in oil and natural-gas output. Its refining and marketing profit climbed by $201 million to $1.7 billion. Its chemicals business saw profits decline by $251 million to $321 million.

Also on Thursday, Marathon said third-quarter profit more than tripled to $770 million, up from $222 million a year earlier. Most of the profit came from its oil and natural-gas production unit.