Major Oil Companies Post Record Earnings in Second Quarter of 1995

Strategic Insights -

Major oil companies posted outstanding earnings for the second quarter of 1995, driven by high crude oil prices, improving refining margins, and strong chemical sector performance. The only underperforming sector was natural gas, which remained low throughout the period. These factors combined to propel many oil giants to post record earnings, with several companies exceeding their previous quarterly highs.

Key Takeaways:

  • Mobil Corp. earned $706 million in operating income, a 38% increase from the same period last year, with operating income of $375 million, $240 million, $87 million, and $153 million from E&P, refining and marketing, U.S. downstream, and international refining and marketing, respectively.
  • Shell Oil reported its second-highest net income ever for the second quarter and the first half periods, with net income of $385 million and $725 million, respectively, and cash flow from operating activities of $595 million.
  • Chevron Corp. posted its highest operating results since the Persian Gulf war, with operating income of $611 million and net income of $607 million, and earnings from E&P operations of $344 million and from refining, marketing, and transportation of $144 million.
  • Amoco Corp. reported net income of $533 million, a 30% increase from the same period last year, with earnings from chemicals more than doubling to $246 million and total E&P earnings of $283 million.
  • Arco reported its best second-quarter results since 1990, with net income of $391 million and sales and operating revenues of $4.4 billion, with earnings from worldwide E&P operations of $209 million and from Arco Chemical Co. of $134 million.

Statistics:

  • Mobil Corp. reported a 38% increase in operating income to $706 million.
  • Shell Oil posted its second-highest net income ever for the second quarter and the first half periods, with net income of $385 million and $725 million, respectively.
  • Chevron Corp. posted its highest operating results since the Persian Gulf war, with operating income of $611 million and net income of $607 million.
  • Amoco Corp. reported a 30% increase in net income to $533 million.
  • Arco reported a 48% increase in net income to $391 million.
  • Domestic crude prices averaged $3/bbl higher than in the year-ago quarter, giving Atlantic Richfield Co. (Arco) a big boost.
  • Total earnings from E&P operations were $344 million for Chevron Corp., $283 million for Amoco Corp., and $209 million for Arco.
  • Refining, marketing, and transportation reported earnings of $144 million for Chevron Corp. and $27 million for Arco.
  • Chemicals operations earned $186 million for Mobil Corp., $181 million for Shell Oil, and $175 million for Chevron Corp.
  • Worldwide production totaled 907,700 bbl of oil equivalent (boe) in the second quarter for Arco.

Sources:

  • Mobil Corp. news release.
  • Shell Oil news release.
  • Chevron Corp. news release.
  • Amoco Corp. news release.
  • Arco news release.