[FoamBone]

I recently heard that Exxon posted something like a $25 BILLION profit, and Royal Shell and others are also expected to post good results (though not that high). Why are the profits so high? or is this to be expected of a resource becoming scarce?

[clv101]

Profits are up since the price of oil has increased dramatically over the last 18 months and cost of production hasn't risen much. Profits are also up since the oil majors aren't spending much on exploration - they know it's not worth it (little economical oil left to discover) so why bother.

I think it speaks volumes that the oil companies are currently cash rich but aren't embarking on much new exploration.

[BabyPeanut]

Supply and demand increased the price of oil.

[Such]

Expect to see oil companies making huge returns as we approach the peak and cross over it. This trend should continue.