Exxon Mobil Corp on Thursday said its quarterly profit fell 68 percent, missing Wall Street estimates, as the global recession bit into fuel demand and crude oil prices fell from year-ago levels.
Analysts attributed the earnings miss to weaker-than-expected results from Exxon's exploration and production arm.
The production was about 4 percent below what we were modeling and that resulted in lower earnings Pavel Molchanov, energy analyst with Raymond James, said.
Exxon, the world's largest publicly traded oil company, and others have seen profits hit as ongoing weakness in world economies hurt demand for energy.
Stockpiles are high, and both crude oil and natural gas prices declined sharply from year-ago levels in the quarter.
The Irving, Texas company's profit in the quarter was $4.73 billion, or 98 cents per share, compared with $14.83 billion, or $2.85 per diluted share, in the same quarter a year earlier.
Analysts on average had expected a profit of $1.03 per share, according to Thomson Reuters I/B/E/S.
Exxon has so far this year spent $19 billion on projects aimed at boosting oil and natural gas output.
We are well-positioned for continued production growth with projects such as QatarGas, RasGas and Gorgon LNG which will contribute additional long-plateau production for decades and provide Exxon Mobil with a strong foundation, Rex Tillerson, Exxon's chief executive, said in a statement.
Oil and gas output in the quarter rose 3 percent, helped by the start-up of several major liquefied natural gas projects in Qatar, Exxon said.
Earnings from the company's exploration and production arm fell 63 percent to $4 billion. Exxon's quarterly refining earnings skidded 89 percent to $325 million, hurt by weak margins.
Revenue fell to $82.26 billion from $137.7 billion a year ago.
Exxon's shares fell 2.3 percent, or $1.66, to $72.18 in morning trading on the New York Stock Exchange.
(Reporting by Anna Driver in Houston, editing by Dave Zimmerman)