Exxon Mobil on Friday beat Wall Street’s estimate for fourth-quarter profit as higher oil and gas production offset lower oil prices and weaker refining margins.
Its profit was $7.39 billion or $1.67 per share, beating analyst estimates of $1.56, LSEG data showed.
Exxon’s low production costs in the basin and its lucrative and prolific projects in Guyana have bolstered the company’s profits despite lower oil prices and a decline in profits on making fuel.
The No. 1 U.S. oil producer reported earnings of $33.46 billion for 2024, down from $38.57 billion the year earlier. Exxon shares were unchanged in trading before the bell on Friday.
The company became the largest oil producer in the Permian basin in 2024, the biggest U.S. oilfield, after closing its acquisition of Pioneer Natural Resources in May.
Its fourth-quarter adjusted earnings from oil and gas production was $6.28 billion, up from $4.15 billion in the same quarter last year. Production reached 4.6 million barrels of oil equivalent per day.
Earnings from producing gasoline and diesel was $323 million, down from $3.2 billion a year earlier. Exxon signaled earlier this month that sharply lower oil refining margins would cut earnings by between $300 million and $700 million compared to the third quarter.
The startup of new oil refineries by other companies in Asia and Africa led to higher global fuel supply, even as demand for gasoline and diesel lagged expectations.
The refining business remains under pressure as the additional supply enters the market, Chief Financial Officer Kathryn Mikells said in an interview.
“That’s really what we’re watching as we look ahead to 2025,” she said.
The company said impairments across the business cost $608 million in the fourth quarter. The charges come from selling assets, including a joint venture in Nigeria, Mikells said.
Exxon continues to expect a decision by September in its arbitration challenge to Chevron’s acquisition of oil producer Hess, she said. If Chevron proceeds, it would gain a foothold in Guyana’s oil projects.
While the deal has been approved by U.S. regulators, Exxon and China’s CNOOC, which are Hess’ partners in the Guyana oil joint venture, say they have a contractual first right to buy Hess’ stake.
Shareholder returns via buybacks and dividends totaled $36 billion in 2024, up from $32 billion.
The shareholder distributions, a cornerstone of Big Oil’s strategy to court investors, were covered by Exxon’s free cash flow of $36.2 billion.
(Reporting by Sheila Dang in Houston; editing by Simon Webb, Michael Perry and Jason Neely)