ExxonMobil profits drop as oil and gas output falls

February 03, 2015 | 15:35

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The biggest US oil company said fourth-quarter net income was US$6.6 billion, down 21.3 per cent from the year-ago period.

Lower oil and gas production has hit ExxonMobil's earnings. (AFP/Saul Loeb)

NEW YORK: ExxonMobil on Monday (Feb 2) reported a fall in quarterly earnings on lower oil and gas production and a weak US refining performance.

The biggest US oil company said fourth-quarter net income was US$6.6 billion, down 21.3 per cent from the year-ago period. Drivers of the decline included a 3.8 per cent drop in oil and gas production and a US$1 million loss in US downstream earnings due to poor refining margins in the company's domestic market.

The weak US refining performance was offset by a rise in non-US refining profits and higher global chemical profits. The Exxon earnings came as oil companies such as Chevron and ConocoPhillips cut drilling budgets due to a steep decline in oil prices that has pressured earnings. Oil prices have fallen about 60 per cent since June.

"ExxonMobil's results illustrate the value of our proven business model that integrates upstream, downstream, and chemical businesses," said Exxon chief executive Rex Tillerson. "Our balanced portfolio uniquely positions ExxonMobil to deliver superior results throughout the commodity price cycle."

Exxon's earnings translated into US$1.56 per share, above the US$1.34 projected by Wall Street analysts. Revenues dropped more than 20 per cent compared with last year to US$87.3 billion, demonstrating the impact from lower crude prices on oil pumped from the ground.

However, costs also fell 18.4 per cent to US$78.4 billion, reflecting the benefit of lower crude oil costs to refining. Exxon's annual profits were US$32.5 billion, down 0.2 per cent from 2013. Exxon shares rose 0.6 per cent in pre-market trade.

AFP

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