Can someone please help me understand how in Q1 we advertised $8 million X identified items with $4 million of trading impact that will be realized at a later date and then we get to Q2 earnings and no one addresses it
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Come back when you know the difference between million and billion
It is mark to market accounting. Think of it like a stock that you buy for $100 in Jan, but on march 31, the stock dropped to 90 (so a 10 loss is reported), then it is sold in May at 110 for an actual cash gain. It is similar for Crude and gas futures contracts ...all in the timing when marked at the end of a quarter and the actual realization the next quarter
We moved to adjusted earnings as our preferred way to discuss earnings after last quarter. Adjusted earnings doesn’t include timing effects.
“ Adjusted earnings rise 67% from first quarter to $14.7 billion Second-quarter production slips to 4.5 million boepd from 4.6 million boepd”. Articles widely point out to the unwinding of derivatives.
Oil prices and production were down in this period, so the delta higher earnings are coming from somewhere else.