This is a carousel. Use Next and Previous buttons to navigate

ConocoPhillips headquarters in the Energy Corridor, Tuesday, May 31, 2022, in Houston.

ExxonMobil chairman and CEO Darren Woods speaks during the first day of the World Petroleum Congress on Monday, Dec. 6, 2021, at the George R Brown Convention Center in Houston.

After battling low oil prices throughout the COVID-19 pandemic, a resurgence in crude prices last year drove Houston’s oil companies to the top of the Chronicle 100.

All but two of the top 10 companies came from the oil and gas sector, as firms small and large took advantage of crude prices that jumped more than 70 percent last year. As health restrictions lifted and the global economy began to return to normal, energy demand jumped, and prices followed.

In October, West Texas Intermediate, the U.S. oil benchmark, hit $85 a barrel, a long way from the historic plunge into negative prices in April 2020. Oil is trading well above $100 a barrel today.

Oil is cyclical industry that operates from boom to bust and back again. But oil’s return to dominance in the Chronicle 100 is a particularly dramatic comeback for an industry that was written off in recent years as investors soured on the sector after two major oil busts in five years and its consistent failure to deliver on promises of big profits.

Adding to the industry’s fall from favor was uncertainty around its future as investors, political leaders and the public turned their attention to climate, clean energy and the energy transition.

But here in Houston, the oil industry remains a key driver of the local economy. The surge in oil and prices and profits has brought billions and billions of dollars into the region, and helped it regain all the jobs lost in the pandemic recession faster than anticipated, according to economists.

The region surpassed its pre-pandemic employment peak in April.

Topping the list of top performing public companies was ConocoPhillips, which despite its massive size managed to grow its revenues more than 140 percent to $45.8 billion, a growth rate exceeding that of all but five other Houston companies. ConocoPhillips’ earning per share ratio grew more than 300 percent, giving its investors an 86 percent rate of return.

The rest of the top 10 includes big names like EOG Resources and ExxonMobil, which is new to the rankings after announcing this year that it was relocating to Houston from its longtime home in Irving. Lesser-known companies such as Coterra Energy, an exploration company that more than doubled its revenue last year, and Adams Resources & Energy, a petroleum marketing firm that increased its earnings per share more than 1,000 percent, also vaulted near the top.

Ryan Lance, CEO of ConocoPhillips, said while crude prices are high now, the best performing oil companies are the ones that are disciplined financially, always ready for the next crash.

“Don’t chase the market up when it goes up because you’re just going to have to chase it down when it goes down,” he said. “Even today, while prices are pretty good, we’re thinking about what happens in the next downturn. So we always got to be prepared to say, ‘You can’t count on this kind of a price structure lasting for a long time.’”

The annual Chronicle 100 rankings are calculated by S&P Global Market Intelligence to gauge how Houston companies compare in terms of financial and stock performance. To be considered, a company must be traded on a major stock exchange and have turned a profit.

With the U.S. economy still recovering from the COVID-19 pandemic in 2021, only 82 companies qualified, up from 56 during the peak of the pandemic in 2020.

The rankings are based on four metrics: total revenue, revenue growth, earnings per share growth and shareholder return. That favors companies improving their fortunes from the previous year, either because they had a particularly good year, or the previous year was especially bad.

Many of the companies that ranked high in last year’s Chronicle 100 slid down the list, struggling to match their performances in 2020, a year that favored construction and infrastructure firms buoyed by government stimulus spending and low interest rates.

Last year’s top-ranked company, The Woodlands home builder LGI Construction, fell to No. 71 on the list. After giving its investors a 219 percent return in 2020, investors lost 45 percent in 2021.

With Houston’s oil companies turning a profit again, the competition was steeper this year. Comfort Systems USA, which provides plumbing, electrical and other services to buildings nationwide, fell from No. 2 to No. 75 even though its revenues grew 8 percent — just 1 percentage point less than in 2020.

Even as the U.S. economy began to recover from the pandemic last year, shortages of everything from computer chips to construction materials made doing business in many industries difficult, said Bill Gilmer, an economist at the University of Houston.

“The big turnaround came in early 2021. All of a sudden the COVID vaccines were available. What that cured in the big sense was a number of service industries, bars and restaurants, retail,” he said. “The pieces of the Houston economy that lagged was anything dependent on the global economy. They’re struggling because of supply chain issues.”

For oil companies, the name of the game in 2021 was financial discipline.

Even as crude prices climbed from less than $50 a barrel at the beginning of the year to more than $76 by year’s end, companies largely opted not to reinvest rising revenues to expand their production. Rather they used the money to pay down debt and boost dividends for investors, something Wall Street had been clamoring for since the downturn in oil markets that began in 2014.

Marathon Oil CEO Lee Tillman told analysts in February that the company was now prioritizing investors, “not the drill bit.”

“The outcomes speak for themselves,” he said. “During the fourth quarter (of 2021), we returned over 70 percent of our cash from operations, or more than $800 million, to our equity investors, significantly exceeding our minimum 40 percent commitment.”

That sort of financial discipline paid dividends in the Chron 100 rankings.

Marathon Oil earned an eighth-place ranking by giving investors a 116 percent return. Eleventh ranked Occidental Petroleum provided its investors a 113 percent return.

The question now, as crude prices climb higher, is whether oil companies can maintain that discipline or revert to behavior during past price spikes, when they rapidly expanded production until it exceeded demand. So far, Houston’s oil sector is holding back.

“If you’re looking at what they’re doing today, they still haven’t reacted to the $100 oil,” Gilmer said. “Prices have been good for a while now. They’ve had plenty of room to react.”

James Osborne covers the intersection of energy and politics from the Houston Chronicle's bureau in Washington D.C.

How did investigators find Holly Marie Clouse, the child of a murdered Texas couple? It all came down to a question about spelling — and a birth certificate.