The global energy sector is in transition, with major oil companies under pressure to cut emissions while staying profitable. Shell, Chevron, and ExxonMobil—three of the world’s biggest energy giants—are taking different paths to navigate this shift.
Their latest earnings reveal how each company is balancing investments in oil, gas, and low-carbon initiatives. While some struggle with declining profits, others are outperforming expectations.
Beyond financials, their sustainability goals and net-zero targets set them apart. But are these commitments keeping pace with financial performance? Let’s dive into their latest financial results and see which energy giant leads the charge toward a greener future.
Who’s Winning the Oil Game? A Financial Face-Off
Shell: Struggling Profits, Big Promises
Shell reported Q4 2024 earnings of $1.20 per ADS (American Depository Share), missing the Zacks Consensus Estimate of $1.78 and significantly lower than $2.22 per ADS in Q4 2023. The company’s revenue dropped to $66.8 billion from $80.1 billion, falling short of expectations by 16.6%. The decline was driven by weaker realized prices, reduced trading margins, and lower LNG sales.
Shell repurchased $3.6 billion in shares and increased its dividend by 5%, with plans for another $3.5 billion in repurchases in Q1 2025. Here is the oil giant’s income per segment:
- Upstream: Profit fell to $1.7 billion from $3.1 billion, missing expectations due to lower oil and gas prices. Liquids prices fell 11%, while natural gas declined 7%.
- Chemicals & Products: Reported a $229 million loss, reversing a $29 million profit from the previous year, due to lower margins and unfavorable tax movements.
- Integrated Gas: Adjusted income dropped to $2.2 billion from $4 billion, missing the expected $2.8 billion due to a 14.3% drop in LNG sales.
- Marketing: Income rose to $839 million from $794 million, but missed expectations of $885 million.
- Renewables & Energy Solutions: Recorded a $311 million loss, down from a $173 million profit a year earlier, due to rising costs and adverse tax effects.
Chevron: A Mixed Bag of Losses and Growth
Chevron’s Q4 earnings fell below Wall Street expectations, reporting adjusted EPS of $2.06 versus the estimated $2.11. This led to a 4% drop in its stock price. The company’s downstream segment posted a $248 million loss, compared to a $1.15 billion profit in Q4 2023. This is because refining margins weakened amid declining fuel demand in the U.S. and China.
- Oil & Gas Production: Profits rose to $4.3 billion from $1.59 billion a year ago, despite a flat overall output of 3.35 million boepd (Barrels of oil equivalent per day). Permian Basin production grew 14% to a record 992,000 boepd.
- Refining: Weak jet fuel demand contributed to the company’s first refining loss since 2020.
Chevron expects global output to grow 6-8% in 2025 and 3-6% in 2026. The company raised its quarterly dividend by 5% and reaffirmed share buyback plans of $10-$20 billion annually.
Exxon: Defying Expectations Amid Industry Headwinds
Exxon announced Q4 2024 earnings of $7.6 billion, or $1.72 per share, exceeding analyst estimates of $1.56. Despite lower oil prices, higher production helped offset the weaker refining margins of this big oil company.
- Oil & Gas Production: Adjusted earnings rose to $6.28 billion from $4.15 billion a year earlier. Production increased to 4.6 million boepd, driven by low production costs in the Permian Basin and Guyana projects.
- Refining: Earnings from gasoline and diesel production dropped sharply to $323 million from $3.2 billion a year earlier due to increased refinery capacity in Asia.
Exxon reported $33.7 billion in earnings for 2024, down from $38.57 billion in 2023, but highlighted strong operational efficiency and profitability.
The three energy giants all faced challenges in Q4 2024, with weaker refining margins and lower oil prices impacting profitability. However, Exxon outperformed expectations, while Chevron and Shell struggled with underwhelming results. All three companies remain focused on capital discipline, shareholder returns, and production efficiency moving forward.
The Green Pivot: Are Big Oil’s Net Zero Pledges Enough?
Shell, Chevron, and ExxonMobil are charting distinct paths toward sustainability as the energy landscape evolves. Their climate commitments, emissions targets, and investment in renewables illustrate their vision for a lower-carbon future.
Each of the energy giants has its own roadmap to net-zero emissions, with varying approaches and strategies. To have a clearer picture of how much carbon pollution each of them emitted in 2023, look at the image below.
While some are making bolder moves in renewables, others remain focused on carbon capture and efficiency improvements. Understanding Shell, Chevron, and ExxonMobil’s strategies provides insight into the future of the oil and gas industry.
Shell’s Carbon Commitment: Big Talk or Real Action?
Shell aims to become a net-zero emissions energy business by 2050 as part of its Powering Progress strategy. This commitment includes eliminating operational emissions and reducing the emissions from the energy products it sells.
The company has set several targets to achieve this goal:
- 50% absolute emissions reduction by 2030 (Scopes 1 and 2) compared to 2016 levels.
- Eliminate routine flaring of natural gas by 2025 to curb carbon emissions.
- Reduce methane emissions intensity below 0.2% and reach near-zero methane emissions by 2030.
- 15-20% reduction in customer emissions from oil products by 2030 (Scope 3, Category 11, 2021 baseline).
Progress Achieved
By the end of 2023, Shell had cut more than 60% of its emissions goal for 2030. The company’s methane emissions intensity was 0.05% for facilities with marketed gas and 0.001% for facilities without marketed gas.
Shell tracks its emissions reductions through Net Carbon Intensity (NCI), which measures emissions per unit of energy sold. Key milestones include:
- 6-8% reduction achieved in 2023 (from 2016 levels)
- 9-12% reduction target for 2024
- 100% reduction goal by 2050
Shell’s strategy for 2030 balances energy security with sustainability. The company plans to reduce emissions by evolving its product mix and shifting towards low-carbon solutions such as biofuels, hydrogen, and renewables.
Shell has also invested heavily in carbon offset initiatives to negate its GHG emissions. However, under CEO Wael Sawan’s leadership, the oil giant is reducing its focus on nature-based projects and is considering engineered carbon removals instead.
- READ MORE: Shell and Microsoft Are The Biggest Carbon Credit Buyers in 2024: What Projects Do They Support?
Today, 70% of Shell’s cash flow comes from Integrated Gas and Upstream businesses, while 75% of its emissions come from Downstream, Renewables, and Energy Solutions. Additionally, Shell has invested heavily in offshore wind projects, with plans to expand its renewable energy portfolio across multiple continents.
Chevron’s Climate Play: Real Solutions or Greenwashing?
Chevron is investing $8 billion in lower-carbon energy projects from 2021-2028, including renewable fuels, carbon capture, hydrogen, and offsets. An additional $2 billion is allocated to reducing emissions within its operations.
The company is also developing new partnerships with tech firms to enhance energy efficiency and reduce its environmental impact.
Chevron targets net-zero upstream Scope 1 and 2 emissions by 2050 but acknowledges that achieving this goal depends on technological advances, regulatory support, and viable carbon capture and offset mechanisms.
2028 Carbon Intensity Targets
Chevron’s plans to lower carbon intensity include:
- 71 g CO₂e/MJ portfolio carbon intensity (Scope 1, 2, and 3)
- 24 kg CO₂e/boe oil carbon intensity (Scope 1 and 2)
- 24 kg CO₂e/boe gas carbon intensity (Scope 1 and 2)
- 36 kg CO₂e/boe refining carbon intensity (Scope 1 and 2)
GHG Reduction Initiatives
Chevron uses the Marginal Abatement Cost Curve (MACC) to optimize carbon reduction. The company has identified 150+ GHG abatement projects, with over $600 million in investments planned for 2024.
Between 2021-2028, Chevron expects $2 billion in GHG reduction investments, targeting 4 million metric tons (mt) of annual emissions reductions. Here are the company’s other sustainability plans and strategies to achieve its ambitious 2050 net zero goal.
Methane and Renewable Energy Expansion
- Methane emissions goal of 2.0 kg CO₂e/boe by 2028
- Advanced methane detection programs, including satellite monitoring
- Growing renewable fuels capacity to 100 mbd by 2030, including renewable diesel and sustainable aviation fuel
- Significant CCUS investments, including Bayou Bend (Texas) and Gorgon (Australia)
- Expanding hydrogen production to 150 mtpa by 2030
- Developing advanced geothermal energy projects to enhance clean energy production
SEE MORE: Chevron Reports Lower Q2 Earnings! What About Its Emissions?
ExxonMobil’s Bold Bet on Decarbonization
ExxonMobil has cut 23% of nitrogen oxides, sulfur oxides, and volatile organic compounds emissions since 2016. In 2023, its GHG emissions stood at 111 MMTCO₂e, marking a 2 MMT reduction from the previous year. The company is also exploring new ways to enhance energy efficiency across its global operations.
ExxonMobil aims for a 20% absolute reduction in GHG emissions by 2030, compared to 2016 levels. The company aligns its emissions reductions with the Paris Agreement while emphasizing intensity-based reductions.
Beyond burning down emissions in its own operations, Exxon is also helping other industries decarbonize. Its Low Carbon Solutions business focuses on hard-to-decarbonize sectors like heavy industry, power, and transportation. The oil giant seeks to lead in profitable, large-scale emission reduction solutions, with the following key strategies.
Key Sustainability Actions
- Investing in carbon capture, biofuels, and hydrogen
- Advancing methane management with innovative detection technologies
- Deploying CCUS projects, including the world’s largest CCUS facility at LaBarge, Wyoming
- Developing low-carbon solutions for hard-to-abate industries
- Launching a $17 billion investment plan in lower-carbon solutions through 2027
- Exploring direct air capture (DAC) technologies to remove CO₂ from the atmosphere
READ MORE: ExxonMobil’s First-of-its-Kind Carbon Capture Solution for the U.S. Data Centers
Big Oil’s Race Against Time
Shell, Chevron, and ExxonMobil are taking different approaches to sustainability and emissions reduction. While Shell focuses on reducing absolute emissions and net carbon intensity, Chevron prioritizes carbon intensity reduction and methane management. ExxonMobil, meanwhile, is expanding CCUS and methane detection efforts to lower emissions.
As global climate policies tighten, Shell, Chevron, ExxonMobil, and other energy companies should accelerate their transition strategies to meet net-zero targets.
- FURTHER READING: Shell’s Polaris Project Fuels Canada’s Carbon Capture Revolution
The post Big Oil’s Showdown: How Shell, Chevron & ExxonMobil Balance Big Profits with Net Zero? appeared first on Carbon Credits.
The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
Net zero is often described as a balancing act: cut what you can, account for the rest, and reach zero on the ledger. That framing is useful, but it leaves something out. It treats every tonne of carbon as interchangeable and every route to zero as equally sound, while the science tells a more specific story.
Malawi has lost a striking share of its forests over the past three decades. Woodlands that once covered well over a third of the country now cover less than a quarter, and the pressure on what remains is increasing. Behind those figures sit two practical questions: what is driving the loss, and what reverses it?
-
Climate Change1 year ago
Guest post: Why China is still building new coal – and when it might stop
-
Greenhouse Gases1 year ago
Guest post: Why China is still building new coal – and when it might stop
-
Greenhouse Gases2 years ago嘉宾来稿：满足中国增长的用电需求 光伏加储能“比新建煤电更实惠”
-
Climate Change2 years ago嘉宾来稿：满足中国增长的用电需求 光伏加储能“比新建煤电更实惠”
-
Climate Change2 years ago
Bill Discounting Climate Change in Florida’s Energy Policy Awaits DeSantis’ Approval
-
Renewable Energy10 months agoSending Progressive Philanthropist George Soros to Prison?
-
Greenhouse Gases1 year ago
嘉宾来稿：探究火山喷发如何影响气候预测
-
Carbon Footprint2 years agoUS SEC’s Climate Disclosure Rules Spur Renewed Interest in Carbon Credits