Key Highlights

● Exxon generated free Cash Flow of $19.11 billion in the third quarter.

● Exxon outlined a $20 billion buyback plan for 2027 and declared a $1.07 dividend.

● Chevron earned $5.28 a share adjusted and declared a $1.78 quarterly dividend.

● Brent rose 2.5% to $117.80 and sits at a six-month high.

The two largest US oil companies reported third-quarter results before Friday's open, and both delivered the kind of cash generation that stands out on a morning when technology stocks are under heavy pressure. Exxon Mobil (NYSE:XOM) was up 2.09% and Chevron (NYSE:CVX) 1.70% premarket as of 7:41 a.m. ET, according to a premarket table, which reported that both beat analyst expectations.

Exxon and Chevron by the numbers

Exxon earned $17.51 billion, or $4.23 a share, excluding identified items, and $15.41 billion, or $3.72 a share, on a GAAP basis, according to its release. Cash flow from operations was $25.65 billion and free cash flow $19.11 billion.

The company returned $9.4 billion to shareholders in the quarter, including $4.3 billion in dividends and $5.1 billion in buybacks. It declared a $1.07 Dividend and outlined a $20 billion buyback plan for 2027. "In the third quarter, we continued to rise to the challenge of meeting global energy needs," CEO Darren Woods said.

Chevron reported Earnings of $9.92 billion, or $5.06 a share, and adjusted earnings of $10.36 billion, or $5.28 a share, according to its 8-K. An earnings calendar listed a pre-week consensus of $4.78, with the basis unspecified. Cash from operations was $16.0 billion and free cash flow $12.0 billion.

Chevron bought back $2.50 billion of stock and paid $3.48 billion in dividends during the quarter, and declared a $1.78 quarterly dividend payable Dec. 10. Production slipped to 3,980 thousand barrels of oil equivalent per day from 4,086 a year earlier. "We delivered strong operational performance and disciplined execution, while continuing to invest to grow energy supply," CEO Mike Wirth said.

The oil price tailwind and the Dow

Crude is doing the heavy lifting. West Texas Intermediate was up 2.18% at $104.20 a barrel and Brent up 2.5% at $117.80 as of about 7:28 a.m. ET, according to market data, after Iran said four tankers struck mines in the Strait of Hormuz and Yemen's Houthis claimed strikes on Saudi oil infrastructure. Brent is up roughly 12% to 14% in October, depending on the source, and sits at a six-month high.

Refining has been a particular winner: media reports said Exxon's refining earnings topped its Upstream earnings for the first time in at least six years.

Exxon and Chevron are both members of the Dow Jones Industrial Average. Their gains are a key reason Dow futures were roughly flat at 52,521 around 8 a.m. ET while S&P 500 futures fell about 1.1% and Nasdaq-100 futures about 2.6%, according to market quotes. Energy is among the sectors set for solid gains in October, according to media reports.

The contrast with tech is stark. Amazon (NASDAQ:AMZN)'s trailing 12-month free cash flow was an outflow of $42.4 billion, while Exxon alone generated more than $19 billion of free cash in a single quarter.

Risks and what to watch

Oil-driven profits depend on geopolitics. Qatari mediators are back in Tehran pushing for a deal to end the US-Iran conflict, according to media reports, and any breakthrough could deflate the risk premium in crude. Falling production at both companies also means volumes are not contributing to growth.

There are policy risks as well, including possible pressure on fuel prices ahead of the midterms. One report said Exxon and Chevron cancelled executive travel to the UAE for an industry event next week.

Watch whether energy Leadership holds after the 9:30 a.m. ET open, the Chicago PMI at 9:45 a.m., and Sunday's OPEC+ subgroup meeting on December output. ConocoPhillips (NYSE:COP) reports next week.