A number of companies came out with strong earnings this morning, and look what lower oil prices do to company profits.
Want to see what lower oil prices do to an oil company's profits? Occidental Petroleum reported earnings down 21 percent from the same period a year ago, although earnings per share of $1.55 were roughly in line with expectations of $1.57. Revenue was down 7 percent, even though average daily production was up.
Want to see what lower oil prices do to an airline company's profits? United Continental's quarterly profit surged about 82 percent. That's right, 82 percent. Earnings on a per share basis were $2.75 for the quarter, compared with $1.51 for the same period last year. Fuel costs are 20 percent to 30 percent of an airline's cost. Some of the profit growth is obviously due to constrained capacity, but you get the point.
The same goes for American Airlines: $1.04 per share for the same period last year compared with $1.66 this quarter.