Higher oil prices boost IOCs’ second quarter results

Higher oil prices have impacted positively on the bottom line of international oil companies  (IOCs) as they release their second quarter results.

BP profit jumps  

BP reported a sharp rise in second quarter profits but warned that further Western sanctions on Russia could harm its business there and its relationship with Russian state oil company Rosneft.

The robust results were underpinned by good production performance from new and recently started higher-margin upstream projects, primarily in the Gulf of Mexico, as well as increased processing of heavy crude oil by the newly modernised refinery at Whiting, Indiana, in the United States.

BP said that to date, the sanctions had not had a significant effect on its business in Russia, where it makes about a third of its crude oil output, but that could change. BP, by far the largest foreign investor in Russia through its 19.75 percent stake in Russian state oil company Rosneft, has repeatedly said it will stand by its investments in Russia since Moscow’s intervention in Ukraine, where pro-Russian rebels are fighting government forces in the east of the country.

For the second quarter, BP said underlying replacement cost profit rose to $3.6 billion, up 36 percent from a year earlier, beating analysts’ forecast of $3.49 billion. BP’s upstream segment reported $4.7 billion underlying pre-tax replacement cost profit, compared with $4.3 billion a year earlier and $4.4 billion in the first quarter of 2014.

Stronger-than-expected result for ExxonMobil 

ExxonMobil, the world’s largest publicly traded oil company, reported a stronger-than-expected quarterly profit as higher prices for its crude and natural gas offset a 6 percent drop in production. The average price that Exxon receives for its crude oil jumped 3 percent in the United States and 5 percent internationally during the quarter.

Exxon said net income rose to $8.78 billion. Part of the increase in profit was due to a gain from Exxon’s sale of its 60 percent stake in a Hong Kong utility and power storage firm earlier this year.

Chevron overcomes production dips in Kazakhstan

Chevron reported better-than-expected quarterly profit as higher energy prices offset rising expenses and production dips in Kazakhstan.

Chevron relied on higher crude oil and natural gas prices to boost results, even as production falls. Chevron said net income rose to $5.67 billion even though production fell 1.4 percent to 2.5 million barrels of oil equivalent per day (boe/d).

Chevron is currently funding five major expansion projects it hopes will boost production by 20 percent by 2017.

Production increase lifts ConocoPhillips’ profit  

ConocoPhillips reported a quarterly profit that just beat expectations, helped by a bigger-than-expected increase in oil and gas production. The company’s oil and natural gas output from continuing operations was 1.56 million barrels oil equivalent per day (boed) in the quarter, up from 1.51 million boed a year earlier. Income totaled $2.08 billion.

ConocoPhillips is drilling more in US shale fields where wells bring better profits and steady production growth is easier to achieve.

The company said it had put its 50 percent interest in Rosneft’s Polar Lights project on the market.So far U.S. sanctions have not affected that process, Chief Financial Officer Jeff Sheets said.

Conoco completed the sale of its 20 percent stake in Russian oil company Lukoil in 2011. Polar Lights produces only about 3,000 to 4,000 barrels per day for Conoco.