While critics often accuse the oil industry of profiteering when prices are high, executives say their companies are prone to cycles. Their share prices have rocketed over the last year after a decade of underperforming almost every other industry. Only two years ago, Exxon reported an annual loss as demand collapsed because of the coronavirus pandemic.
The variables that will determine oil companies’ profitability this year are largely out of their control — in both supply and demand. The war in Ukraine could expand or not; a recession in the United States and Europe could be deep or averted entirely. Prices for fuels, and inflation generally, will largely depend on how events play out.
Despite the war, Europe’s economy in recent months has been stronger than expected, in large part because the mild winter has kept gas demand and prices in check.
The International Energy Agency has projected that oil demand this year will grow modestly, by nearly two million barrels a day, reaching 101.7 million barrels a day. That may support oil company profits.
As pandemic restrictions have eased, an increase in air travel has added to the demand on refineries for jet fuel. The ability of oil companies to provide fuel at reasonable prices could be stretched, especially since they have been cautious about increasing production.
And with lockdowns lifted in China, its economy should grow faster, and demand for oil and gas should increase, if the country can overcome a new virus surge. But the picture remains unfocused. Chinese oil imports remain low for the moment, and Chinese refineries are gearing up for a recovery by producing more fuels for domestic consumption and export.
Another wild card is Russia.
With Russia’s war in Ukraine, Russian oil and gas supplies might be constrained by lower production because of Western sanctions and a lack of foreign investment. Before the war, Russia produced one out of every 10 barrels of oil consumed worldwide. Its exports have declined, although more slowly than many analysts expected at the outset of the war.

This data comes from MediaIntel.Asia's Media Intelligence and Media Monitoring Platform.