What's going on?

US oil giants Chevron and Exxon Mobil both posted record quarterly profits on Friday.

What does this mean?

The average price of one of Chevron�s barrels of oil was up 65% last quarter from the same time last year, while its natural gas was up nearly 200%. That helped the firm bring in a quarterly profit of nearly $12 billion � around 50% more than its previous quarterly record. Exxon didn�t do too shabbily either, with the rival oil giant�s profit coming in at record $17.9 billion � around four times more than it managed this time last year.

If you�re thinking those are big ol� profits at a time when so many people are being crippled by their energy bills, you�re not alone: the US has previously called on companies to raise output to bring prices down, and this will only reinforce their concerns. And sure, Chevron and Exxon have both said they�re boosting supply, but the numbers don�t lie: they�re investing less in production than they are on share buybacks and dividends.

Why should I care?

The bigger picture: What goes up�
This comes hot on the heels of Shell and TotalEnergies� updates last week, in which they broke records and tripled profits respectively. That means the four oil giants � plus BP, which reports next week � are on track to have made well over $50 billion in profit last quarter. But with the prospect of a recession looming, analysts think it could be downhill from here. That�s certainly plausible: the oil price fell 20% from its 14-year high last quarter.

For markets: Energy is your king.
That potential for recession has weighed down the energy sector�s stocks, with a key index tracking some of its biggest US companies down around 20% since June. But so dominant has the sector been that it�s still by far the best-performing of the year: it�s up 35% since the start of January, while the second-best performer � utilities � has risen a measly 2%.