Quick Stats

Quick Stats

    You are here

    Profits Fall Unexpectedly for ExxonMobil

    Meanwhile, Shell and Murphy Oil see numbers rise.

    NEW YORK -- In a turn of events unforeseen by analysts, Exxon Mobil Corp., which holds the record for the most profitable quarter in history for any U.S. company, saw its profit decline for the first time in more than three years, due to a decrease in production and crude oil prices, reported Bloomberg News.

    Second-quarter net income for the company dropped to $10.3 billion from $10.4 billion, the report stated. Oil and natural-gas output declined 1 percent -- equaling 4.12 million barrels of crude daily -- even after CEO Rex Tillerson brought on new wells in Nigeria, Russia, Qatar and the United Arab Emirates, according to the report.

    "I'm surprised production declined," Douglas Ober, manager of $2.5 billion at Baltimore-based Adams Express Co., where ExxonMobil is his largest holding, told Bloomberg News. "I would've thought they'd be higher."

    CSNews Online reported yesterday before the earnings release that analysts predicted the company could report upwards of $11 billion for the second quarter of 2007, and may even eclipse its own record for annual earnings, set in 2006 at $39.5 billion.

    In addition, oil prices fell 8.1 percent compared to a year ago, to average $65.02 a barrel in the second quarter. As a result, the company’s revenue dropped 0.7 percent to $98.4 billion.

    The fall in profits was a first for Exxon Mobil since the first quarter of 2004, when that year’s comparable period included $2.2 billion in one-time gains. Excluding today's results, the company fell short of analyst earnings estimates once in six quarters.

    In other earnings news, Royal Dutch Shell reported an 18-percent rise in second-quarter profit, due to gains from the company's refineries, which offset reduced oil production compared to last year, CNNMoney.com reported.

    Profit at Shell rose to $8.67 billion from $ 7.32 billion in the year-ago quarter. Revenue rose to $84.9 billion from $83.1 billion.

    Production slipped 2 percent to 3.18 million barrels of oil equivalent, due to geopolitical tensions and OPEC restrictions, the report stated.

    Profit in its oil products unit jumped 42 percent as the division kept refinery throughput steady from last year, at 3.81 million barrels of oil equivalent a day, according to the report.

    Meanwhile, Murphy Oil also announced its second quarter results, which saw net income reach $250.3 million, compared to the $216.2 million seen in the year-ago period. Net income for the El Dorado, Ark.-based company was affected by after-tax costs of $24 million for the closure of 55 retail gas stations in the U.S. and Canada, the company stated.

    Income from exploration and production declined to $149.3 million in the second quarter, compared to $245.1 million in the same quarter of 2006. The company attributed the fall to lower crude oil and natural gas sales volumes, but noted that it benefited from higher oil and natural gas sales prices during the quarter.

    The company's refining and marketing operations generated $124.2 million in income for the second quarter 2007, the company stated, adding that North American refining and marketing margins were strong in the quarter.

    • About

    Related Content

    Related Content