Oil Company Profits Rise 1.7%, U.S. Says

Profits for major oil companies increased by less than 2% in the months immediately after the Persian Gulf crisis, and most benefits from higher prices went to oil-producing countries, the Energy Department reported today.

A report by the Energy Information Administration said higher crude oil prices “led to substantial increases in income from oil and gas production” but that the beneficiaries often were foreign governments.

Income for oil-producing countries, as well as for domestic producers, soared in the third quarter by 684% compared to the same three-month period in 1989, the report said. But for the most part, the benefit did not pass on to many of the oil companies, it said.

“For the major petroleum companies, increased profits from oil and gas production were nearly offset by reduced earnings from refining, marketing and chemical businesses,” the report said.

The net income for major U.S. oil companies was up 1.7% overall. Companies that had to buy crude oil and petroleum products at the higher prices reported profit declines, the report said.

Some refineries reported sharp increases in profits, however.