HOUSTON: Oil giants ExxonMobil and Chevron posted higher-than-expected quarterly earnings yesterday, as profits from refineries helped offset a steep decline in crude oil prices.ExxonMobil, the world's largest publicly traded company, saw its fourth-quarter earnings fall by a third from a year ago, but its last year's profit of $45.2billion set a new company and US record.
"The results speak for themselves," said Fred Burke, president of Johnston Lemon Asset Management.
"I still think Exxon is a low-cost producer, and at some point the price of oil will increase. They are doing all the right things right now."
The energy sector has been hit hard by the twin blows of a sell-off in oil and gas prices and the global credit crunch, but the the largest companies like Exxon and Chevron that havebns in cash were well-suited to weather the downturn.
Irving, Texas-based Exxon said its net profit in the quarter was $7.8bn, or $1.55 per share, compared with $11.7bn, or $2.13 per share, in the same period a year earlier.
Analysts on average had expected a profit of $1.45 per share, according to Reuters Estimates.
Chevron, the second largest US oil company behind Exxon, saw its quarterly profit rise to $4.9bn, or $2.44 per share, from $4.88bn, or $2.32 per share, in the year-ago quarter, helped by the $600 million one-time gain in which it received stock for a producing field.
Excluding the one-time asset swap gain, Chevron's earnings slipped from a year earlier, but its $2.23 per share profit still topped analysts' average forecast of $1.79 per share, says Reuters Estimates.
Exxon's refining operations benefited from the decline in crude oil prices versus the price for products such as gasoline and diesel, widening its profit margins and boosting quarterly profits by $147m to $2.41bn.
Still, that gain was modest compared to the $2.57bn drop in profits generated from oil and gas production to $5.63bn in the quarter, which suffered as average crude oil prices fell to about $59 a barrel in the fourth quarter from about $90 per barrel a year ago.
Oil production fell 45,000 barrels per day to 2.47 million bpd, largely because of cuts in Opec quotas in countries where Exxon operates and asset sales.
