Exxon Mobil Corp on Friday signaled that skyrocketing margins from fuel. So as, crude sales could generate a record quarterly profit, according to a securities filing. Energy prices have shot up this year with oil selling for more than $105 per barrel. While, gasoline at about $5 per gallon in the United States. The enormous earnings are likely to ignite new calls for windfall profit taxes.
The largest U.S. oil producer projected a sequential increase of about $7.4 billion in operating profits compared with the first quarter. In the first quarter, Exxon posted an $8.8 billion profit, excluding a Russia writedown. The filing indicates a potential profit of more than $16 billion for the second quarter. The company’s peak quarterly profit was $15.9 billion in 2012. The filing showed Exxon expects higher oil and gas prices will add about $2.9 billion to results. Margins from selling gasoline and diesel will add another $4.5 billion to operating profits.
Exxon’s profits led U.S. President Joe Biden last month to say the company and other oil majors were capitalizing on a global oil supply shortage to fatten profits. Exxon, he said, was making “more money than God” after posting its biggest quarterly profit in seven years.
The company reacted to the president’s comments saying it is investing more than any other producer in the United States. This to expand oil and natural gas production, including in the Permian, the country’s largest unconventional basin.
U.S. Representative Ro Khanna on Friday said Exxon’s record-breaking profits reinforce his call for Congress to pass a windfall tax on Big Oil. Exxon, which lost more than $22 billion in 2020, has been using the extra cash from higher energy. However, prices sales to pay debt and raise distributions to shareholders. It plans to buy back up to $30 billion of its shares through 2023. The company estimated the impact of exiting Russia would cut oil and gas profits by about $150 million compared with the first quarter. Exxon wrote down $3.4 billion in Russia assets earlier this year. Exxon also signaled a contribution of about $300 million from asset sales in the quarter.