ExxonMobil has indicated a significant decline in operating profits for the second quarter, as per a regulatory filing. The operating earnings fell to approximately US$7.8 billion compared to US$17.85 billion in the same period last year. The previous year’s figures were bolstered by surging oil and gas prices following Russia’s invasion of Ukraine, resulting in record global energy results.
The second-quarter outlook for Exxon also slipped from its record-breaking first-quarter profit of US$11.4 billion, according to estimates compiled by Reuters. Analysts on Wall Street are anticipating a per-share profit of US$2.27 for the quarter ending on June 30.
Lower natural gas prices have had a significant impact, with U.S. natural gas futures trading close to a two-year low at US$2.657 per million British thermal units. This decline in prices is attributed to reduced consumption levels in Europe.
The results from Exxon’s oil and gas business, which constitutes its largest and most profitable segment, fell by approximately US$2.2 billion compared to the US$6.5 billion achieved in the first quarter. The decrease in operating profit can be attributed to lower natural gas prices, which affected earnings by around US$2 billion, as highlighted in the regulatory filing.
Additionally, weaker refining margins further contributed to the decline in operating results for Exxon’s gasoline and diesel business, reducing earnings by another US$2.1 billion.
However, there was some positive news from the chemicals business, which performed better in the second quarter. The operating earnings indicated quarterly profits of US$800 million, doubling the level from the first quarter.
Official results for the second quarter are expected to be released on July 28.