The big oil companies are bouncing back from the recession, with earnings being driven by higher fuel prices.

The oil industry was hurt last year as the global economic crisis caused the prices of oil and natural gas to plunge dramatically.

Exxon Mobil Corp. reported earnings of US$7.56 billion (*S$10.30) in the second quarter of the year. Royal Dutch Shell Group posted a 15 per cent rise in net profits. ConocoPhilips said that their net income nearly tripled in the second quarter. Shell’s net profit rose from US$3.82 billion to US$4.39 billion, year-on-year.

Despite having to wait out a ban on deepwater drilling in the Gulf of Mexico following the oil spill, oil companies are focusing on drilling in other parts of the globe. With their extensive global business networks, the impact of the halt will be minimal for the oil companies. Exxon continues to explore the waters around Indonesia and Philippines.

Exxon’s net income almost doubled due to rising oil prices and an increase in gasoline demand. Prices grew to US$78.16 from US$59.80. Natural gas prices rose 14 per cent in Q2 to an average of US$4.35 per 1,000 cubic feet. Oil and natural gas production was boosted by 8 per cent.

Exxon has a relatively small portion of business in the Gulf of Mexico, unlike BP and Shell since a bulk of its income comes from exploration and operations in the waters in Africa, Asia and the Middle East.

For BP however, the delays in the Gulf are paramount at the moment. It had to pay US$32.2 billion to cover the costs of the oil spill. The British oil company reported a loss of US$17 billion in the second quarter of 2010.

For the three oil companies, deepwater exploration will continue since it is the few places where they can grow. Most of the world’s oil reserves are controlled by state-owned companies.

*Exchange rate correct as at 30 July 2010