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Exxon Mobil profits soar although production falls

The biggest gas and oil company in the US, Exxon Mobil, has experienced a large increase in its profits after recently cutting its spending on exploration and capital.

The company has stated that profit is its priority, ahead of furthering its production of gas and oil.

Exxon Mobil’s net income increased by 28% compared with one year ago, a rise that was greater than expected.

The increase in profit was partly due to the sale of Exxon Mobil’s 60% share in a Hong Kong power storage and utility firm. Higher crude oil and natural gas prices contributed towards an increase in revenue of around 5%, even though the company’s gas and oil production fell by almost 6%.

Analyst Brian Youngberg of Edward Jones said that, for Exxon Mobil, falling production rates are a “recurring theme”. He also described the company as “growth-challenged”, due to its enormous size.

Exxon Mobil is known for its wide range of quality products, such as Mobil Pegasus 1, a high performing gas engine lubricant made from synthetic base oils. The company has struggled to renew its reserves recently, but it has invested in long-term projects that are expected to take a few years to bear fruit.

Although Exxon Mobil shares fell by 2.6% and its fall in production is not viewed as positive, financial services manager Oliver Pursche said that investors would be mistaken if they interpreted this as the start of a negative trend. He maintained that future exploration could make up for the company’s current drop in production.

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