America’s energy sector is thriving.
On Friday, ExxonMobil and Chevron — America’s largest oil companies — reported record results. Combined the 2 companies raked in more than $30bn of profit in the last 3 months, with Exxon printing their best quarter in the company’s 156-year history.
Considering the state of the US economy, energy execs are keen to play down their success, fearing political retribution. Indeed, in recent months the Biden administration has been mounting pressure on oil companies to reinvest in supply chains rather than return the cash to shareholders in the form of dividends or share buybacks — a plea that so far has gone mostly unnoticed.
Across the swathe of corporate America, the energy sector is the anomaly of 2022. Every other sector in the S&P 500 Index has lost ground this year. Energy is up 66%.
If 2020-2021 were the boom years for virtual goods and services, 2022 has been the year for “stuff that comes out of the ground”, as imbalances between supply and demand for oil, gas, raw materials and food have seen prices soar.