Exxon and Chevron beat profit estimates as refining margins surge

Exxon and Chevron beat quarterly profit estimates as their refining businesses earned more from making fuel.

Conflicts involving Iran and Russia’s war in Ukraine disrupted energy markets, while threats to the Strait of Hormuz and attacks on refineries reduced fuel-making capacity and pushed gasoline and diesel prices higher.

Exxon’s refining earnings exceeded its upstream earnings for the first time in at least six years, while Chevron’s refining and distribution earnings reached their highest level in that period.

Both companies said they are investing in refineries to increase fuel supply, but the accounts differ on which company said U.S. output would rise by 100,000 barrels a day.

The companies are using extra cash to cut debt and strengthen their finances rather than increase dividends or share buybacks.

High fuel prices are adding to voter frustration ahead of U.S. midterm elections, and executives were expected to face questions about shareholder payouts and investment plans on earnings calls later Friday.