Earnings from chemical operations at five major oil companies in the first quarter totaled $1.58 billion, up 8.2% from the same period one year earlier, thanks to ExxonMobil, the only one of the five with an earnings improvement. Without ExxonMobil, combined earnings from the other four companies were down 32.4%.
ExxonMobil said nothing about why its chemicals business performed so well while other companies' businesses fell. An analysis of the firm's data shows that the gain came mainly from overseas. ExxonMobil's U.S. operations managed an only 5.2% earnings increase for the quarter. Earnings from its non-U.S. operations, however, grew 43.5% to $890 million. These results came as chemical product volumes rose 4.2% in the U.S. while declining 5.2% overseas.
Of the other four companies, ConocoPhillips posted the smallest decline. Its earnings fell 16.3% to $82.0 million. The decrease from the first quarter of 2006 was due primarily to lower operating margins in its olefin and polyolefin businesses. First-quarter results were boosted by a business interruption insurance payment.
At Chevron, ConocoPhillips' partner in their Chevron Phillips Chemical joint venture, chemical earnings were $120.0 million, down 21.6% from the year-earlier quarter. The decrease, the company says, was due largely to lower margins on sales of commodity chemicals by the joint venture. Margins on sales of lubricant and fuel additives by Chevron's Oronite subsidiary were higher than in first-quarter 2006.
At Sunoco's chemical operations, which are much smaller than those of the other companies, earnings declined 35.7% to $9.0 million, due largely to lower margins and sales volumes for both phenol and polypropylene, partially offset by lower expenses. The lower volumes stem in part, the company says, from tight feedstock availability related to plant maintenance at the company's Philadelphia refinery and a power outage at a third-party supplier of steam to Sunoco's Marcus Hook, Pa., refinery.
Occidental Petroleum had the deepest earnings drop: 45.2% to $137.0 million, reflecting lower margins for caustic soda and polyvinyl chloride. Oxy is the only one of the five companies that publishes chemical sales, and these were down 14.6% to $1.06 billion.