Exxon Mobil profit sinks, Chevron rises as both boost output
HOUSTON, Aug 3: Weaker second-quarter refining and chemicals profits offset surging US shale production at US oil majors Exxon Mobil Corp and Chevron Corp, the two reported on Friday.
Exxon's topped analysts' reduced estimates for the quarter but net fell 21per cent from a year earlier, its third quarter in a row of weaker year-over-year profit, despite a near doubling in Permian shale oil output.
Chevron earnings rose 26per cent, in line with forecasts, as it benefited from a one-time, $1-billion breakup fee from Anadarko Petroleum (APC.N), which accepted a higher bid from Occidental Petroleum (OXY.N) after agreeing to sell itself to Chevron.
Shares of both companies fell on Friday with Exxon off 1per cent at $71.75 a share and Chevron down a penny at $120.73 as the market fell on US-China trade concerns.
Exxon's weaker earnings mirrored those at rivals Royal Dutch Shell (RDSa.L) and Total SA (TOTF.PA), and both US companies said natural gas prices and chemical margins fell from a year-earlier.
Shell's profit was its smallest in 30 months, due to weaker chemicals, refining and tumbling natural gas prices. Total also cited weaker natural gas and refining operations for earnings that fell 19per cent from a year ago.
Exxon's net income fell to $3.13 billion, or 73 cents per share, in the second quarter, from $3.95 billion, or 92 cents per share, last year. Analysts had slashed their estimates last month after the company disclosed weaker results in natural gas, chemicals and refining.
"Pretty weak quarter from them once again," said Jennifer Rowland, analyst with Edward Jones. After spending on major projects and dividends, Exxon had a free cash flow shortfall of $2.7 billion, she said. Investors closely watch that measure as a sign of the company's financial health. -Reuters