ExxonMobil signals 1Q operating profit fell 25% on softer energy prices

EXXONMOBIL on Tuesday (Apr 4) signalled in securities filing that first-quarter operating profits dropped about 25 per cent from last year’s record levels as oil and gas prices eased.

Operating results could drop to about US$9.6 billion, compared to US$12.8 billion net profit from the fourth quarter, according to a snapshot of factors affecting first-quarter earnings.

The drop was driven by the exploration business, with ExxonMobil signalling operating results from pumping oil and gas would be about US$5.2 billion, down from the US$8.2 billion in last year’s final quarter.

Global oil prices fell about 7 per cent to an average of US$82 per barrel while US gas prices fell by more than half in the most recent period, both compared to the final quarter of 2022. Global oil settled on Tuesday near US$85 a barrel.

Profits from refining oil into petrol, diesel and other energy products slipped to about US$3.55 billion on higher maintenance costs and weaker margins, the filing indicated.

Its chemicals business was flat compared with the fourth quarter at about US$300 million in operating profit, the snapshot showed. Earnings from motor oils fell to about US$500 million from US$800 million in the fourth quarter.

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Full results are expected to be released on Apr 28.

ExxonMobil shares were off about 1 per cent on Tuesday at US$115.

The earnings drop from weaker oil prices might be temporary. A surprise production cut disclosed on Sunday by the Organization of the Petroleum Exporting Countries and allies including Russia (Opec+) have Wall Street analysts forecasting crude could reach US$100 per barrel this year. REUTERS