Exxon results soar on gas prices
Exxon Mobil Corp. earned nearly $11 billion US in the first quarter, a performance that will likely land it in the centre of the national debate over high gasoline prices.
The world's largest publicly traded company reported Thursday a net income of $10.65 billion, or $2.14 per share, in the first three months of the year, compared with $6.3 billion, or 1.33 per share. Revenue increased 26 per cent to $114 billion.
The results surpassed Wall Street estimates of $2.04 per share on sales of $112.6 billion, according to FactSet.
The quarter was Exxon's best since earning a record-setting $14.83 billion in the third quarter of 2008. It comes at a time when some drivers are paying $4 or more for gas and President Obama is threatening the oil industry's multibillion-dollar tax subsidies.
Exxon increased earnings despite a slight drop in worldwide oil and natural gas liquids production. Benchmark crude prices increased 20 per cent from the same period last year.
Earnings grew across the company's business segments. Income from its exploration and production business gained 49 per cent to $8.7 billion while the company's downstream business, which includes refineries, posted a huge 30-fold jump to more than $1.1 billion.
Anticipating a strong reaction to the results from drivers and politicians, Exxon said on a company blog Wednesday that it has little control over the price of oil, which has risen to near $113 per barrel. The company also noted that less than 3 cents of every dollar it earns comes from the sale of gasoline and diesel fuel.
That may not appease many motorists, however. The national average for a gallon of gas is $3.89, about $1.02 more than a year ago. It's above $4 in eight states and the District of Columbia.
On the blog, Ken Cohen, Exxon's vice-president of public and government affairs, said the company was anticipating "the inevitable headlines and sound bites about high gasoline prices and what to do about them" after the earnings were reported.