As the unprecedented energy crisis caused by the Ukraine war comes to an end, the profits of the five major oil majors sharply declined in the second quarter of this year.
According to major foreign media and various IR materials on the 30th (local time), the world's five major oil companies saw their net profits in the second quarter of this year drop sharply by 28% to 73% compared to the same period last year. ExxonMobil, the No. 1 oil company in the United States, recorded a net profit of $7.88 billion in the second quarter of this year, a 56% decrease compared to $17.85 billion in the same period last year. Chevron, one of the two major oil majors along with ExxonMobil, also recorded a net profit of $6.01 billion, down 48% from $11.622 billion in the same period last year.
During the same period, British oil company Shell recorded a net profit of $5.1 billion, more than halving its net profit compared to the record high of $11.5 billion in the second quarter of last year. French energy company TotalEnergies and Norwegian oil company Equinor also saw their net profits drop sharply by 28% and 73%, respectively, compared to the same period last year. British Petroleum (BP), which will announce its earnings on the 1st of next month, is also expected by foreign media to record results similar to those of these five companies.
These five oil giants (ExxonMobil, Chevron, Shell, TotalEnergies, BP) earned a total of $238 billion (approximately 304 trillion won) over five quarters from last year through the first quarter of this year. This was the result of an unprecedented boom caused by the surge in international crude oil and natural gas prices amid the Cold War dynamics that began after Russia's invasion of Ukraine in February last year. This historic performance in the energy industry led to increased pressure from political circles around the world, including the Biden administration in the United States, to expand windfall taxes (excess profit taxes). President Biden pressured ExxonMobil by saying it "made more money than God," emphasizing that the energy industry's profits should be returned to consumers through the imposition of windfall taxes.
However, as fears of a recession have increased, international oil prices have fallen below $80 per barrel (based on West Texas Intermediate, WTI), and oil prices have somewhat stabilized, bringing an end to the profit party of the oil giants. Claudio Descalzi, CEO of Italian oil company Eni, said, "It does not seem that the profits of global oil companies will return to last year's levels," adding, "The rebound in demand after the pandemic and the effects of the Ukraine war created an unprecedented boom in the energy industry, but now that boom is over."
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