Exxon Mobil Corp. said its earnings plunged by more than half in the second quarter of 2015. The Irving, Texas oil giant Friday announced quarterly profits of $4.2 billion, down from $8.8 billion in the same period last year.
The slouch in global oil prices and cutbacks in oil and gas production and exploration drove the dampening of Exxon’s earnings. The oil-and-gas giant’s upstream business saw $2 billion in quarterly earnings, a 66 percent drop from the second quarter of 2014.
Downstream operations, which include refining and marketing, fared much better. Exxon reported second quarter earnings of $1.5 billion, a $795 million increase over the same period a year ago.
“Our quarterly results reflect the disparate impacts of the current commodity price environment,” Rex Tillerson, Exxon’s chairman and CEO, said in a statement ahead of a morning earnings conference call. However, the earnings “also demonstrate the strength of our sound operations, superior project execution capabilities, as well as continued discipline in capital and expense management.”
Exxon’s profit in the quarter fell to $1.00 per share, compared with $2.05 per share in April-June period last year. Total revenue fell to $74.11 billion from nearly $112 billion a year ago.
Wall Street analysts had expected Exxon to deliver quarterly earnings per share of $1.11 on $72.48 in revenue, according to estimates by Thomson Reuters, CNBC reported. Exxon shares fell in premarket trading following the announcement.
Exxon's stock fell 2 percent to $81.30 in early trading Friday.
Oil prices have plummeted in the past year, dropping more than 50 percent amid a surge in supplies and waning demand in China, Europe and emerging economies. Brent crude, the global benchmark, fell again Friday after the head of OPEC indicated the oil cartel would not slash production, exacerbating fears of a global oversupply.
Brent was down 70 cents at $52.61 a barrel Friday, Reuters reported. U.S. light crude fell 87 cents to $47.65 a barrel.
The price slump has similarly battered Exxon’s competitors in the global oil and gas market.
Royal Dutch Shell PLC said Thursday it will cut 6,500 jobs this year due to weaker oil prices. The company said it will also trim its 2015 capital investment by $7 billion and cut operating costs by $4 billion. “We have to be resilient in a world where oil prices remain low for some time, whilst keeping an eye on recovery,” Ben van Beurden, Shell’s CEO, said in a statement.
The Anglo-Dutch oil giant’s second quarter earnings were $3.4 billion, down 35 percent compared to last year.
On Tuesday, BP PLC posted a loss of more than $6 billion in its results for the second quarter of 2015. Tepid oil prices played a role, as did the $9.8 billion pretax charge BP agreed to pay the U.S. government for the 2010 Deepwater Horizon oil spill disaster in the Gulf of Mexico.