Exxon Mobil Faces Upstream Earnings Hit of $1 Billion in Third Quarter Due to Oil Price Decline
In a recent regulatory filing, Exxon Mobil has indicated that changes in oil prices will lead to a significant decrease in its third-quarter upstream earnings, potentially ranging from $600 million to $1 billion. Additionally, the energy major expects refining margins to negatively impact profits by up to $1 billion during the same period.
The decline in oil prices during the July-September quarter has been attributed to concerns surrounding global oil demand growth. Exxon had reported $7.07 billion in upstream earnings for the second quarter and a net profit of $9.1 billion in the year-ago third quarter.
Analysts are anticipating Exxon to post an adjusted profit of $1.97 per share in the third quarter, according to estimates compiled by LSEG.
Analysis:
The recent announcement by Exxon Mobil regarding the expected impact of oil price changes on its earnings sheds light on the challenges faced by energy companies in a volatile market environment. Investors and stakeholders should closely monitor Exxon's performance in the upcoming quarter to assess the implications for their investment portfolios. The downward pressure on earnings underscores the importance of diversification and risk management strategies in navigating the uncertainties of the energy sector.