Exxon Mobil reported strong profits from its refining and chemical businesses for the fourth quarter. The earnings compensated for the disappointing results in its gas and oil businesses. The oil giant got net income of $9.95 billion in the quarter, which is up 6 percent from the previous year. The company’s domestic refining division benefitted from the increase in domestic oil production that has brought down the price of crude that refiners process.
Exxon Mobile reported a 5 percent decline in gas and oil production with earnings from output in its upstream business dropping 12 percent in the quarter. The poor results in the production business underscored the struggling experienced by most major oil companies in replacing old oil fields with new reserves. Exxon Mobile and other companies are struggling to make profits in domestic shale gas fields because of the oversupply of natural gas that has forced the price of gas to go down by around 60 percent over the last five years.
Chevron, which is the second American oil company, reported strong refining results. That pushed its fourth quarter earnings by 41 percent to a record $7.25 billion. The company reported that crude oil production declined by 1.2 percent.
Chevron suffered oil production declines over the last two years but analysts say that the development of offshore exploration projects in the Gulf of Mexico, longer term liquefied natural gas transport projects, and domestic oil shale development would enable the company to expand its production by next year.
In the last quarter, Exxon tried to increase its reserves and production by buying 196,000 acres in Montana and North Dakota from Denbury Resources for $1.6 billion to add to its Bakken shale oil field. Exxon Mobil also bought XTO Energy four years ago for $41 billion to become the largest natural gas producer in the US.