Steep second-quarter profit increases were reported yesterday by Gulf Oil Corp, the nation's fifth largest petroleum company, and Standard Oil Co. of Ohio (Sohio).
Gulf executives attributed their firm's 65 percent jump in earnings almost entirely to overseas operations, but Sohio said higher profit margins at gas pumps and rising prices for crude oil output -- particularyfrom the Cleveland firm's investments in Alaska - contributed to a 70 percent increase in its second-quarter profits.
Among large oil companies reporting second-quarter results to date, yesterday's gains were by far the most substantial. Industry analysis have said oil company officials likely will be embarrassed by the rich profits they are reporting from a period when many Americans had to wait in gasoline station lines and retail prices soared.
"The tight supply enviroment in the world oil market is not of the oil companies' making, although they cannot help but benefit from it," said William Randol of Blyth Eastman Dillon & Co. "The fallout effects from the political upheavals in Iran have caused the tight market situation, which is in a lull right now but could tighten still further."
As had Exxon Corp. and Standard Oil of Indiana (Amoco earlier this week, Gulf said yesterday that its recent profit increases did not reflect primarily business in the United States.
Gulf earnings were $291 million ($1.49 a share) in the April-June quarter compared with $176 million (90 cents) a year ago as revenues rose to $6.1 billion from $4.7 billion,
Six-month profits for the Pittsburgh-based firm rose to $540 million ($2.77) from $337 million ($1.73) and sales increased to $11.7 billion from $9.6 billion.
Jerry McAfee, Gulf's chairman, said net profits in this country rose 3 percent during the first six months to $263 million from $255 million a year earlier.
Before taxes and corporate overhead in the recent six months, earnings were up 25 percent for domestic petroleum operations. "This largely reflects the fact that by operating our refineries at 94 percent of capacity, by drawing down inventors and by increasing crude oil imports by 23 percent to 433,000 barrels per day, we were able to supply our customers with 13 percent more gasoline and 16 percent more distillate than we sold during the first six months of 1978," McAfee added.
Despite writing off a controversial pipeline project, Sohio Chairman Alton Whitehouse said a doubling of the price his firm received for its crude oil, higher Alaskan output and higher profits margins at gas stations helped boost second-quarter profits to $201.4 million ($1.68) from $118.4 million ($1.03) last year. Sales increased to $1.8 billion from $1.3 billion for the nation's 16th largest oil firm.
In the first half of 1979, Sohio'sprofits soared 130 percent to $369 million ($3.07) from $160 million ($1.51) and sales increased to $3.47 billion from $2.36 billion.
Whitehouse said West Coast refineries now are able to use more than half of Sohio's Prudhoe Bay oil, where production averaged 549,100 barrels a day in the recent quarter, up 15,500 barrels from a year ago. The profit increases came despite a decision to write off $57.3 million before taxes as a result of abandoning a proposed crude oil pipeline from California to Texas. CAPTION: Graph, Big Oil Profits By Alice Kresse - The Washington Post