By Gary McWilliams
HOUSTON, Nov 2 (Reuters) - Earnings for the two largest U.S.oil companies on Friday jumped on higher crude prices and thenation's shale boom, joining big oil rivals in posting sharplyhigher quarterly profit.
Exxon Mobil Corp posted a 57-percent increase onprices there were up 44 percent over a year ago helped by alower tax rate while Chevron Corp's earnings doubled onsurging output from the Permian Basin of West Texas and NewMexico.
While Exxon's results topped Wall Street forecasts, butshares were up fractionally as its oil and gas productiondeclined for the ninth of the last 10 quarters.
Chevron's shares rose 2.7 percent as it forecast continuedstrong oil production this quarter.
Results for most of the world's top oil companies arereturning to levels not seen in four years, driven by strongdemand for oil and years of cost-cutting. Royal Dutch Shellposted income of $5.6 billion on Thursday and BP Plcthis week reported profit of $3.8 billion.
Irving, Texas-based Exxon is investing heavily to reverseits production declines. It spent $6.59 billion on capitalprojects during the quarter, up 10 percent from the same periodlast year.
Executives on Friday said the company plans to continue toprioritize spending on new projects and shareholder dividendsover stock repurchases, something that investors have beencalling for it to restart. Exxon halted buybacks except tooffset dilution in 2016.
"The company that a decade ago had the largest buybackprogram in the S&P 500 is now altogether absent from the buybacktable," said Raymond James analyst Pavel Molchanov in a note onFriday.
Chevron said it benefited from running 20 drilling rigs inthe Permian basin during the quarter and new well designs thathave boosted output. It produced 338,000 barrels of oilequivalent per day during the quarter from the field andforecast sustained Permian growth this quarter.
"The economic outcomes are really outstanding," PatYarrington, Chevron finance chief, told analysts on Friday.
She said that the San Ramon California-based company plansto hold to its full-year capital spending budget of between $18billion and $20 billion, despite spending about $450 millionmore than it anticipated year-to-date.
Exxon reported earnings of $6.24 billion, or $1.46 pershare, while analysts had forecast a per share profit of $1.23.Chevron reported earnings of $4.05 billion, or $2.11 per share,compared with analysts' estimate for $2.06 per share, accordingto IBES data from Refinitiv.
(Reporting by Gary McWilliamsEditing by Nick Zieminski)