Oct. 27 (Bloomberg) -- Exxon Mobil Corp. and Royal Dutch Shell Plc posted record net income of almost $19 billion combined after energy prices surged to unprecedented highs amid disruptions caused by Hurricanes Katrina and Rita.

Third-quarter profit at Exxon Mobil, the world's biggest publicly traded oil producer, jumped 75 percent to an industry record of $9.92 billion, the company said today in a statement. The Hague-based Shell set the previous record about six hours earlier, when it said net income rose 68 percent to $9 billion.

Oil, natural-gas and gasoline prices, already near all-time highs because of rising demand, climbed further as hurricanes choked off output from the Gulf of Mexico and idled refineries from Texas to Mississippi. The world's five biggest investor- owned oil companies are heading for combined 2005 profit of almost $107 billion, according to analyst estimates, partly on the widening gap between crude costs and refined fuel prices.

"A combination of high oil prices and refining margins, which are exemplary, will continue to bolster profits for these companies," said Douglas Ober, who manages $2 billion, including Shell and Exxon Mobil shares, at Adams Express Co. in Baltimore.

Net income at Marathon Oil Corp., the fourth-largest U.S. oil producer, more than tripled to $770 million, or $2.09 a share, the Houston-based company said in a statement. Revenue climbed 40 percent to $17.2 billion.

Bigger Than Egypt

Irving, Texas-based Exxon Mobil exceeded $100 billion in revenue for the first time. Revenue rose 32 percent to $100.7 billion, dwarfing the economies of such countries as Egypt and the Philippines. Shell's revenue climbed to $94.7 billion from $89 billion.

London-based BP Plc, the world's second-biggest publicly traded oil company, on Oct. 25 reported a 34 percent gain in third-quarter net income to $6.53 billion. ConocoPhillips, the No. 3 U.S. oil producer, yesterday said its profit jumped 89 percent to a record $3.8 billion. Chevron Corp., the second- largest U.S. oil company, plans to report earnings tomorrow.

"It's all on price," said James Halloran, who helps manage $33 billion, including Exxon Mobil and Shell shares, at National City Private Client Group in Cleveland. "They're going crazy on price."

The average per-barrel profit on making diesel, gasoline and other refined fuels surged 92 percent to a record $15.22, based on futures contracts traded in New York.

Record Results

The previous profit record for Exxon Mobil was $8.42 billion, set in last year's fourth quarter. That was also the oil industry's high-water mark before this morning. There have been three higher quarterly profits reported by U.S. companies, MediaOne Group Inc., Ford Motor Co. and AT&T Corp.

Shell was hit hard by the hurricanes. The company's Mars offshore platform, which pumped about 5 percent of Shell's oil, will stay shut for at least eight more months for repairs, the company said today.

Even with that production loss, Shell's profit was about $400 million higher than the median analyst estimate in a Bloomberg survey.

Shell's Class B shares climbed 9 pence to 1,700 pence ($30.31) in London. Exxon Mobil fell 25 cents to $55.95 at 11:53 a.m. in New York Stock Exchange composite trading. Marathon, which fell short of analyst earnings expectations, dropped $2.44, or 4 percent, to $58.64.

`Captured the Benefit'

"We captured the benefit of high oil and gas prices and refinery margins, even after the impact of hurricanes in the U.S.," Chief Executive Jeroen van der Veer told reporters today on a conference call.

Profit from oil and gas sales at Exxon Mobil, which account for three-quarters of the company's earnings, surged 87 percent to $7.35 billion as high prices more than made up for a 4.7 percent decline in output. Shell's oil and gas profit more than doubled to $5 billion from $2.3 billion.

Independent oil and gas producers, those that don't own refineries, also had profit increases in the quarter.

Houston-based Apache Corp., the six-largest independent producer in the U.S., today said its third-quarter net income surged 60 percent to $687 million.

Petro-Canada and Suncor Energy Inc., both based in Calgary, also reported higher earnings. Petro-Canada said its net income rose to C$614 million ($526 million) from C$410 million a year earlier. Profit at Suncor, where gains were held back by a fire that disrupted output from a northern Alberta oil-sands plant, rose to C$341 million from C$337 million.

Demand Keeps Rising

High prices so far haven't stemmed increases in demand, which is growing as economies expand in Asia and the Americas. Worldwide demand for refined fuels has climbed 1.3 percent this year, Henry Hubble, an Exxon Mobil vice president, told investors today on a conference call.

Petro-Canada Chief Executive Ron Brenneman said prices should eventually have an impact on consumption.

"I think you have to anticipate that in time, there will be some behavioral change and lifestyle change and driving decisions and car decisions that will ultimately impact demand, but we're not seeing it at this point in time," Brenneman said on Petro- Canada's earnings conference call.

National City's Halloran said oil profits in future quarters may be dragged down by rising expenses for the labor and equipment need to find and develop new reserves.

"Investors aren't thinking about what it's going to cost to replace the oil being pumped now," Halloran said. "Costs have gone up dramatically."

Commentary:
The GOP tried to gut environmental laws to help the oil industry just a few weeks ago. House Bill To Weakens Environmental Standards

Why can't they use their profits to increase production?