ExxonMobil Warns Lower Oil Prices and Refining Margins Will Hurt Q3 Profit
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FREDERIC J. BROWN / AFP via Getty Images Vehicles pass an ExxonMobil gas station on September 23, 2024 in Rosemead, California.
Key TakeawaysExxonMobil said lower oil prices and refining margins will lower third quarter profit as compared to the second quarter.The company predicted that the change in prices would lower upstream earnings by $600 million to $1 billion, and the change in industry margins would do the same for energy products.ExxonMobil's stock price has basically mirrored the price of oil this year.
ExxonMobil (XOM) warned that lower oil prices and refining margins will have a negative impact on third quarter results as compared to the previous quarter.The energy giant wrote in a regulatory filing that a change in crude prices would cause a $600 million to $1 billion reduction in upstream profit. It expects a similar financial effect by a change in industry margins for energy products. The company added that gas prices could either boost upstream earnings by $200 million or cut them by $200 million.ExxonMobil made $9.2 billion in the second quarter. It posted $9.1 billion in earnings in the third quarter of 2023.Oil Futures Had Been Declining Until Recent Middle East TensionsOil futures began losing ground in July, and hit their lowest level since January last month. They've bounced back recently, now on a six-day winning streak, as worries about possible disruptions if the fighting in the Middle East escalates.ExxonMobil shares, which were up 1.8% in Friday afternoon trading, have basically mirrored the oil moves, and are about 25% higher year-to-date.
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