Russia’s invasion of Ukraine in 2022 has complicated the world economy’s post-pandemic recovery and sent oil and energy prices soaring. This resulted in huge profits for oil companies. For example, the American oil group ExxonMobil earned 59.1 billion dollars last year, compared to 23 billion a year earlier.
“Their profits are a windfall from the war – a windfall from the brutal conflict that is ravaging Ukraine and hurting tens of millions of people around the world,” US President Joe Biden said of the exceptional economic results of the oil giants last October.
However, the current results season shows how the situation is returning to normal. In the third quarter of this year, the aforementioned ExxonMobil’s profit fell by more than half year-on-year. Rival Chevron also announced that its net profit fell by two-fifths year-on-year. For example, energy giant BP (British Petrol) saw its net profit drop to $3.3 billion in the same period of the quarter. This is a sixty percent decrease year-on-year.
For example, the Polish petrochemical company Orlen, which owns the only oil processor in the Czech Republic, Unipetrol, published its results on Tuesday. In the third quarter, Orlen’s profit fell by 76 percent year-on-year to 3.46 billion zlotys (19.1 billion CZK), the company said in its results report. For Chevron, ExxonMobil, and Orlen, the results are also affected by the recent acquisitions of smaller competitors on the market.
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The price of oil is falling worldwide mainly due to the slowdown in the growth of the global economy. The World Bank (SB), for example, predicted that a barrel of oil on the global market in the fourth quarter of this year will sell for an average of $90 and next year for $81. And the smaller the demand for the raw material, the lower its price.
But the falling price pushes up consumption. In most of the selected states, gasoline and diesel were burned year-on-year more or similar to last year. However, due to the lower price of fuel, it was not enough for the same profits as the oil producers had last year.