Higher oil and gas demand and the best-ever quarterly performance in the chemicals business helped ExxonMobil (NYSE: XOM) beat analyst expectations as it reported second-quarter 2021 earnings of $4.7 billion.
The earnings for Q2 2021 compare to a loss of $1.08 billion Exxon had booked for the second quarter of 2020, when it reported its worst loss in its modern history because of the oil demand and oil price crash.
Total revenues more than doubled from Q2 2020 to stand at $67.742 billion for Q2 2021, and were also ahead of Wall Street estimates of around $65 billion.
Cash flow from operating activities of $9.7 billion funded the dividend, capital investments, and debt reduction, Exxon said.
In the second quarter of 2021, Exxon’s production volumes in the Permian averaged 400,000 oil-equivalent barrels per day, an increase of 34 percent from the second quarter of 2020.
Strong base operations supported Exxon’s best-ever quarterly earnings in the chemicals segment of $2.3 billion, reflecting higher margins and continued cost discipline.
The Street had expected a very strong performance in the chemicals division, analysts told Bloomberg earlier this week.
“We’re realizing significant benefits from an improved cost structure, solid operating performance and low-cost-of-supply investments that, together, are generating attractive returns and strong cash flow to fund our capital program, pay the dividend and reduce debt. This was particularly true for our Chemical business that delivered their best quarter in company history,” Exxon’s chairman and chief executive officer Darren Woods said.
Going forward, Exxon expects to spend more on its key projects, including Guyana, Brazil, Permian, and the Chemical business, in the second half of 2021. Yet, full-year spending would be towards the lower end of the guidance range of $16 billion to $19 billion.
Also today, the other U.S. supermajor, Chevron (NYSE: CVX), reported earnings above expectations for the second quarter on the back of rallying commodity prices and said it would resume share repurchases this quarter.
By Tsvetana Paraskova for Oilprice.com
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