EXXONMOBIL on Wednesday (Apr 3) signalled first-quarter operating results would drop over the prior quarter on weaker oil, gas prices and a big loss in fuel derivatives, a securities filing showed.

The drop follows two years of strong oil and fuel prices that turned the largest US oil company into one of the most profitable energy companies globally. Last year, it posted a record profit for a first quarter at US$11.4 billion.

The biggest impact in the latest quarter came from weak natural gas prices and fuel derivatives, which reversed course after run-ups last year.

Overall, the snapshot shows about US$6.7 billion in operating profit for the quarter, compared to US$11.6 billion in the same quarter a year ago and US$7.6 billion in the fourth quarter.

Investors expect the company to post an adjusted per share profit of US$2.21, compared to the year-ago’s US$2.83, according to financial firm LSEG’s consensus estimate.

Natural gas prices fell to multi-year lows during the quarter. Overall weaker oil and gas prices alone cut ExxonMobil’s profits by about US$600 million compared to the fourth quarter of 2023.

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The company also said fuel derivatives undercut gains in petrol and diesel margins, costing it about US$1.1 billion compared to the fourth quarter. Refining maintenance costs also jumped last quarter, the filing showed.

Last year’s financial gains led ExxonMobil to pursue all-stock deals for US shale oil producer Pioneer Natural Resources and carbon storage firm Denbury. Its shares were up 16.2 per cent during the first quarter and finished at US$119.30 on Wednesday.

The company also claims a preemptive right over Hess’ Guyana assets, the prize in Chevron’s US$53 billion offer for Hess. That claim is being considered by an international arbitration panel.

The company is expected to post full results for the period on Apr 26. REUTERS