October 1, 2023

LOGAN CYRUS/AFP/AFP via Getty Images

ExxonMobil earnings fell short of forecasts on lower oil and natural gas prices.

New York

ExxonMobil’s profit fell sharply in the second quarter on lower oil and natural gas prices, leaving earnings below Wall Street forecasts.

The company earned $7.9 billion, or $1.94 a share, down 56% from a year earlier. Analysts surveyed by Refinitiv had forecast earnings of $2.01 a share.

Revenue was also sharply lower, falling 27% from a year ago to $80.8 billion. But the top-line number edged above forecasts.

The good news for ExxonMobil and bad news for drivers is that oil and gas prices have been climbing recently. The average gas price nationally hit an eight-month high Friday of $3.73 a gallon, according to AAA, as excessive heat and production caps have hurt supply. That’s up 15 cents a gallon, or 4%, in just the last week.

It was a relatively rare earnings miss for the nation’s largest oil company. The last time it didn’t beat analysts’ forecast was the first quarter of last year, and before that in 2020 when oil prices tumbled to negative territory on a plunge of demand at the start of the pandemic.

This time oil and gas prices were down by a far more modest amount. The price for a barrel of Brent crude oil, the international benchmark used by traders, closed the quarter at $74.90, down 6% from the end of the previous quarter and down 35% from a year earlier. Oil prices soared and gas prices hit record levels in the second quarter a year ago in the wake of Russia’s invasion of Ukraine.

But after a year of steadily falling, crude prices have rebounded 12% in the four weeks since the end of the quarter after both Saudi Arabia and Russia announced another round of oil production cuts and fears of a US recession started to retreat.

The situation was similar at Chevron, which reported adjusted earnings of $5.8 billion, or $3.08 a share, on Friday. That was down 14% from the first quarter and 49% from a year earlier. But unlike ExxonMobil it beat Wall Street forecasts of $2.97 a share.

Shares of ExxonMobil

and Chevron

were both narrowly lower in premarket trading.

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