ConocoPhillips said on Thursday profit more than doubled to $18.7 billion in 2022, the highest since the company spun off its refining business in 2012, as the oil producer benefited from stronger prices on tight supplies and robust demand.
Source: Reuters
Global crude oil prices climbed 10.45% in 2022, thanks to a surge in demand from economies rebounding after the pandemic, coupled with shortages caused by sanctions on Russia over its invasion of Ukraine.
Total average realized price rose 8% to $71.05 per barrel of oil equivalent in the fourth quarter, ConocoPhillips said.
Larger rivals Exxon Mobil Corp and Chevron Corp posted record profits last month, renewing criticism of the oil industry and sparking more calls to levy windfall profit taxes on the companies.
Houston-based ConocoPhillips also declared a variable dividend of 60 cents, with plans to return $11 billion to shareholders in 2023 – lower than the $15 billion it returned last year and below what analysts had expected.
That, along with weaker oil prices on the day and a quarterly profit miss, sent its shares down nearly 3% to $114.44.
“Return of capital target for 2023 is below our model and 2022, but that appears mostly related to commodity price assumptions, so we think there is upside optionality,” said RBC Capital Markets analyst Scott Hanold.
President Joe Biden has urged oil companies and refiners to invest their profits into boosting production to reduce prices before considering shareholder returns.
ConocoPhillips expects capital expenditure to be between $10.7 billion and $11.3 billion this year, including spending on its Willow oil and gas drilling project in Alaska, which got a scaled-back support from the Biden administration on Wednesday.
Production was 1.758 million barrels of oil equivalent per day (boed) for the fourth quarter, an increase of 150,000 boed from a year ago.
“ConocoPhillips finished 2022 on a solid note with production volumes exceeding consensus forecasts by 1.5%,” said Third Bridge analyst Peter McNally.
Current-quarter production is expected between 1.72 million and 1.76 million boepd.
On an adjusted basis, the company posted quarterly profit of $2.71 per share, missing expectations of $2.81, according to Refinitiv data.
