Canada's integrated oil and gas producer Suncor Energy surpassed analysts' expectations for third-quarter profit on Tuesday, as higher oil prices and strength in refinery margins helped offset lower production and throughput volumes.
The Iran war, now entering its ninth month, has disrupted global energy supplies, driving up crude oil prices. The average price of benchmark Brent crude was 31% higher at $89.27 per barrel for the quarter compared with a year earlier.
Integrated oil companies such as Imperial Oil IMO.TO and Suncor have benefited from a global fuel market roiled by the war, with the higher oil prices strengthening margins in both production and refining.
Last week, Imperial Oil IMO.TO also beat analysts' estimates for quarterly profit, backed by strong refining margins.
During the quarter, Suncor reported a fall in both upstream production and throughput volumes. However, higher oil prices helped drive revenue from oil sands production up 32% to C$9.32 billion ($6.66 billion).
Revenues from its refining operations surged over 65% to about C$13.4 billion, driven by a more than two-fold jump in benchmark crack spreads, allowing refiners to earn significantly more from processing each barrel of crude.
The Calgary, Alberta-based company's upstream production fell 2% to 852,500 barrels per day while refinery throughput fell slightly to 487,700 bpd.
Suncor announced a quarterly dividend of 66 Canadian cents per share payable December 24, a 10% increase compared to prior quarter.
In October, Suncor agreed to sell its interests in three offshore Canada oil assets to Ithaca ITH.L for C$1.2 billion and increased share repurchases from C$500 million to C$750 million per month beginning in October.
The company posted an adjusted operating profit of C$3.97 per share for the quarter ended September 30, compared with analysts' average estimate of C$3.28 per share, according to data compiled by LSEG.
($1 = 1.3998 Canadian dollars)
(Reuters - Reporting by Akshaya V in Bengaluru, additional reporting by Vallari Srivastava in Bengaluru; Editing by Leroy Leo and Shailesh Kuber)