Imperial Oil more than doubles quarterly profit on soaring crude prices

Imperial Oil announced a significant increase in its second-quarter profit, more than doubling earnings and exceeding analyst expectations. The surge in profit was driven by a sharp rise in crude prices and enhanced refining margins, which compensated for reduced oil sands output and scheduled refinery maintenance.

Benchmark crude prices climbed during the quarter, influenced by geopolitical tensions in the Middle East and global supply uncertainties. This led to a substantial increase in Imperial's realized prices, with synthetic crude prices rising over 60 percent and Western Canada Select prices up about 45 percent year-over-year. These higher prices helped to offset a slight decrease in total upstream production, which averaged 414,000 barrels of oil equivalent per day, down from 427,000 a year prior.

CEO John Whelan conveyed optimism regarding Canada's oil industry's future. He highlighted the potential for Imperial to significantly increase its upstream production, possibly doubling it over time, by leveraging its high-quality oil sands leases and advanced technology. This outlook is bolstered by a recent agreement between the federal government and Alberta aimed at fostering production growth through supportive policy conditions.

The company did experience a dip in refinery throughput, falling to 331,000 barrels per day from 376,000, with utilization dropping to 76 percent from 87 percent. This was attributed to planned maintenance at its Strathcona refinery and some unplanned downtime. Imperial has adjusted its 2026 refinery outlook downwards, citing these operational challenges and a short-term rail logistics issue at Strathcona, which it expects to resolve by year-end.

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With a supportive fiscal and regulatory framework, Imperial has the potential to double our gross operated upstream production over time, with the development of our high-quality oil sands leases using our advantaged technology.