Oil firms reap huge profits after storms

• Article
• Comments ()
• Click-2-Listen
• Videos

By

Exxon Mobil Corp.'s profits surged 75 percent to a record $9.92 billion in the third quarter, fueled by high crude oil and natural gas prices, the world's largest publicly traded oil company reported yesterday.

Revenue for the Irving, Texas, oil giant neared $101 billion in the quarter -- the first time a U.S. company has broken the $100 billion mark in a three-month period.

Marathon Oil Corp., the fourth-biggest U.S. oil company, and Royal Dutch Shell, Europe's second-biggest oil company, also reported record profits for the third quarter.

Houston-based Marathon's net income rose to $770 million from $222 million a year earlier. The Hague-based Shell said net income rose 68 percent to $9 billion.

"It's all on price," James Halloran, who helps manage $33 billion, including Exxon Mobil and Shell shares, at National City Private Client Group in Cleveland, told Bloomberg News. "They're going crazy on price."

Prices for natural gas, oil and gasoline, already near record highs because of rising demand, were driven higher by Hurricanes Katrina and Rita, which damaged and shut down oil platforms and refineries around the Gulf of Mexico, crimping supply.

A gallon of unleaded gasoline in the District peaked at an average of $3.38 on Sept. 7 -- the highest in the nation at one point -- though it is now about $2.71, according to AAA Mid-Atlantic.

The world's five biggest publicly traded oil companies are heading for combined 2005 profit of almost $107 billion, according to analyst estimates, partly because of the widening gap between crude costs and refined fuel prices.

Members of Congress and the Bush administration are admonishing the oil industry for record profits on the back of historically high prices paid by consumers for gasoline, natural gas and home heating oil.

Senate Majority Leader Bill Frist said yesterday he has instructed two committees to hold hearings on high prices and instructed an investigative subcommittee to examine whether companies have engaged in price gouging.