Profits at oil companies have soared this year as rising demand and energy supply bottlenecks have resulted in a demand-supply collision, intensified by Western sanctions imposed on Russia's invasion of Ukraine. The sanctions have caused a significant increase in oil and gas supply by U.S. market players to European countries, resulting in high earnings.
Exxon's Continued Investment in Fossil Fuels Strategy Paid Off with a Significant Increase in Profits
While Exxon's European rivals have focused more on renewable energy over the past five years, the company has kept investing in fossil fuels. The decision to keep investing paid off in the last few quarters for the company.
Furthermore, to keep up with the rising energy demand, the company has accelerated investments in traditional and new energy businesses over the past few quarters.
Diversified Business Portfolio Helps Exxon to Remain Stable During Volatile Market Conditions
Due to unpredictable market conditions across different countries worldwide, the margins for different energy products fluctuate. Exxon's diversification strategy has served it well during the erratic swings in prices and margins across the various businesses.
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