HOUSTON — Exxon Mobil, the largest American oil company, reported a 53 percent increase in its fourth-quarter profit on Monday, helped by an improving world economy that has increased energy demand and crude prices.
It was the strongest quarterly profit in more than two years, reflecting the strong recovery in oil markets. They soared in 2007 and 2008, collapsed in 2009, and returned to loftier heights by the end of 2010.
"It's a home run," said Fadel Gheit, managing director for oil and gas research at Oppenheimer & Company. "It's a big positive earnings surprise on strong operating results across all business segments underpinned by strong production growth, higher oil and gas prices and improved margins."
Exxon's performance was in line with the strong results of most other large energy companies, which have benefited not only from rising oil prices but also from improved margins in their refinery businesses.
Nevertheless, the results do not equal the record profits set a few years ago, when oil and gas prices were far higher than they were at the end of last year or even today.
Oil prices have been steadily creeping up in recent months to over $90 a barrel, settling on Monday at $92.19. The turbulence in Egypt has made traders skittish about the possibility of shortages of supplies if the Suez Canal is somehow blocked or political tensions spread to nearby Saudi Arabia. But natural gas prices, which are increasingly important to big oil companies, which have been increasing their gas investments in recent years, remain depressed.
Oil and gas prices rose again on Monday, with developments in Egypt serving as a reminder that the energy markets were vulnerable to political events in such vital producing countries as Nigeria, Iraq and Iran, which did not suffer major production interruptions in 2010.
Rising political tensions mixed with continued growth in economic demand usually means higher energy prices. But the Organization of the Petroleum Exporting Countries still has the capacity to produce more oil in the event of a slowdown in traffic in the Suez Canal or interruptions in production in one or two producing countries.
Exxon Mobil's profit in the quarter was $9.25 billion, or $1.85 a share, compared with $6.05 billion, or $1.27 a share in the period a year ago. Analysts surveyed by Thomson Reuters had expected $1.63 a share. Total revenue in the quarter was $105.2 billion, up from $89.8 billion in the quarter a year earlier.
For the year, Exxon Mobil made $30.46 billion, or $6.22 a share, compared with $19.28 billion, or $3.98 a share, for 2009. Revenue for 2010 rose to $383 billion from $310 billion the previous year.
Exxon Mobil said its production increased 19 percent in the quarter. Gas production in the United States has tripled as a result of the company's acquisition of XTO Energy and other purchases of companies with shale field operations around the country. Gas now accounts for almost half of the company's production, up from 43 percent a year ago.
Earnings from the company's upstream business, which includes oil and gas production, rose to $7.48 billion in the quarter from $5.78 billion in the period a year earlier.
rest at http://www.nytimes.com/2011/02/01/business/01oil.html?_r=2
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