Exxon exceeds Wall Street profit estimates, thanks to Guyana and Permian oil production
Exxon Mobil beat Wall Street's first-quarter profit estimate on Friday as higher oil and natural gas production in Guyana and Permian Basin helped boost earnings.
According to data compiled and analyzed by LSEG, the profit for the quarter January-March was $7.71billion or $1.76 a share. This beat analyst expectations of $1.73 a share.
Exxon and the energy sector as a whole have had a turbulent start to the new year, after U.S. president Donald Trump's announcements of global tariffs stoked fears of recession. These concerns led to a drop in oil prices, as a weaker economy requires less energy.
Trump, who wants to lower gas prices for consumers and cut regulations in order to increase oil and natural gas production, has implemented policies that he says will do so. Energy companies have generally not increased their investment plans, with some exceptions. They are also bracing themselves for a recession after the oil price in April dropped to its lowest level in four years.
If oil prices continue to fall, producers will cut back on spending and drilling rather than increase it.
Exxon produced 4.55 million barrels equivalent to oil per day (boepd), up from 3.78 millions boepd during the same quarter last year.
Exxon distributed $4.3 billion as dividends, and purchased $4.8 billion worth of shares in the third quarter. The company is on track to reach its $20 billion annual goal for share repurchases with the buyback figure.
Exxon CEO Darren Woods stated in a press release that "in this uncertain market our shareholders can have confidence in knowing we're built to this".
The earnings from oil and gas production increased to $6.76 billion from $5.66 in the same period of last year.
Refining profit was $827 million. This is down from $1.38 billion one year earlier.
Exxon and Chevron are locked in an arbitral battle over Chevron’s proposed $53 billion purchase of Hess. Hess owns 30% in a Guyana joint venture led by Exxon.
Exxon, CNOOC and the third consortium partner, Hess, claim they have the right to buy the stake of Hess. The hearing for the arbitration case will be held in London on May 26.
The company's shares were unchanged in Friday morning pre-market trading. Sheila Dang reported from Houston, and Nia Williams edited the story.
(source: Reuters)
