Exxon and Chevron Surpass Q3 Profit Estimates with Increased Oil Production

In the latest financial update, Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) have announced that they exceeded third-quarter profit expectations. The companies attribute their success to record-high oil production, gaining an advantage over their European competitors who are making significant investments in renewable energy sources.

Exxon reported an impressive 24% increase in oil production compared to the same period last year, reaching 4.6 million barrels of oil equivalent per day (boepd). This increase is largely due to the acquisitions of Pioneer Natural Resources (NYSE:PXD) and Denbury. Chevron also experienced a significant increase in production; thanks to its U.S. shale oil operations and expansion plans in Kazakhstan, its output rose by 14% to 1.61 million boepd.

Despite a drop in global refining margins that affected the entire sector, both companies managed to minimize profit losses compared to their European competitors. Exxon’s profits decreased by only 5%, while Chevron experienced a 21% decline. In comparison, BP (NYSE:BP) saw a 30% drop, and TotalEnergies (EPA:TTEF) reported a 37% decline in adjusted net income.

Exxon’s earnings of $1.92 per share eclipsed Wall Street estimates by four cents, while Chevron's adjusted earnings of $2.51 per share also surpassed analysts' forecasts of $2.42 according to LSEG data. These positive financial results led to a nearly 2% increase in share prices in pre-market trading.

Both companies achieved record levels of oil and gas production from the Permian Basin, the leading U.S. shale oil field. Exxon’s production in the region reached a new record of 1.4 million boepd, with no signs of slowing down operations. Chevron reported a record-level production of 950,000 boepd, partly due to its acquisition of PDC Energy (NASDAQ:PDCE), marking a 22% increase and aiming to reach 1 million boepd in the field next year.

Exon’s CFO Kathryn Mikells expressed optimism about the company's growth prospects, stating, “We see tremendous opportunities for profitable growth in both our existing and new businesses.” Meanwhile, Chevron's progress has temporarily stalled due to regulatory delays concerning its $53 billion acquisition of Hess (NYSE:HES), but the company continues to make strides in U.S. shale initiatives and international projects.

While the companies' robust production shields them from some market challenges, they remain cautious about the future due to uncertainties such as demand fluctuations in China and potential changes in OPEC’s production restrictions.