Exxon Cashes in on Oil

Exxon Cashes in on Oil

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  • Exxon Mobil Corp. is expected to see a boost of approximately $2.1 billion in earnings for the third quarter, primarily attributed to higher oil prices and improved refining margins. However, this increase was partially offset by a decline in profitability in the chemicals segment. The surge in crude oil prices contributed around $1.1 billion to the earnings, and refining activities added another $1 billion in profits, as disclosed by Exxon, based in Spring, Texas, in a filing on Wednesday.
  • An uptick in gas prices also contributed around $400 million to the earnings. Nevertheless, these gains are expected to be offset by losses in the chemicals sector, which further declined from already low levels. According to John Royall, an analyst at JPMorgan Chase & Co., this guidance suggests that Exxon's earnings for the quarter are estimated to be approximately $2.33 per share, aligning with the average of analysts' estimates compiled by Bloomberg. In after-market trading, the company's stock saw a decline of 0.8%.

Why it matters

Analysts anticipate that Exxon's third-quarter earnings will show an improvement compared to the second quarter, marking a reversal after three consecutive quarterly declines—a pattern not seen since the oil price crash between 2014 and 2016. Exxon's report sets the tone for other major oil companies, including Chevron Corp., BP Plc, Shell Plc, and TotalEnergies SE, as they prepare to announce their third-quarter earnings.


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