Big Oil’s profits continue to be pumped

NEW YORK — The major oil companies continue to climb back from the recession, with higher fuel prices driving up earnings.

After setting record profits in 2008, the oil industry tanked last year as the global economic downturn induced a dramatic drop in oil and natural gas prices. On Thursday, Exxon Mobil Corp. said it earned $7.56 billion in the second quarter, its best result since the last three months of 2008. Royal Dutch Shell Group posted a 15 percent gain in net income. A day earlier, ConocoPhillips said net income nearly tripled in the April-June period.

Chevron Corp. reports its quarterly results today.

The jump in profits comes as oil companies wait out a ban on deep-water drilling in the Gulf of Mexico that is scheduled to last until Nov. 30. Shell took a $56 million charge for idling its rigs while Exxon Mobil halted work on an appraisal well and suspended operations at one of its Gulf platforms.

But their operations are so vast that the impact is likely to be minimal. And both remain committed to drilling in deep water around the globe, including the Gulf. Irving-based Exxon Mobil continues to explore the deep waters off countries including Indonesia and the Philippines.

“Slight delay in the Gulf, but we’re proceeding full speed ahead in the rest of the world,” Exxon Mobil Vice President David Rosenthal said in a conference call with investors.

Shell said it plans to wait out America’s six-month ban on exploratory drilling.

“We are just trying to keep the rigs warm, ready to start up again,” Shell Chief financial officer Simon Henry said.

Net income for the second quarter rose to $4.39 billion from $3.82 billion a year earlier, Shell said.

For BP, of course, the Gulf is paramount at the moment. It will be paying for years for the oil spill set off in April when the Deepwater Horizon rig exploded and sank. The British oil company took a charge of $32.2 billion to cover the costs that it can reliably estimate at this time. On Tuesday, it reported a record quarterly loss of $17 billion.

BP, however, remains committed to deep-water projects. The company plans to begin drilling a well off the coast of Libya in coming weeks.

Argus Research analyst Phil Weiss said Exxon, BP and Shell have no choice but to keep exploring the deep sea. Most of the world’s oil reserves are in the hands of state-owned companies, he said.

“Deepwater is one of the few places where they can grow.”

For its second quarter, Exxon Mobil’s net income nearly doubled as oil prices rose to an average of $78.16 from $59.80. Revenue increased 24 percent to $92.5 billion. The company boosted oil and natural gas production by 8 percent. Refining margins also improved as gasoline demand increased.

Per-share earnings rose to $1.60 from or 81 cents. Analysts had expected $1.46 per share on revenue of $98.5 billion. Shares fell 57 cents to $60.34.

In the year-ago quarter, Exxon Mobil’s $3.95 billion profit set a six-year low. The drop came just three quarters after Exxon set the record profit for a U.S. company of $14.83 billion.

Unlike BP and Shell, Exxon Mobil does a relatively small portion of its business in the Gulf of Mexico.

The bulk of its income comes from exploration and production operations in foreign waters, particularly in Africa, Asia and the Middle East. Earnings from producing oil and natural gas outside the U.S. rose to $4.47 billion from $3 billion in the second quarter.