Oil company profits soar, but Exxon disappoints

Exxon Mobil Corp broke its own record for the highest-ever quarterly profit for a U.S. company on Thursday, but it was lower than Wall Street expected largely due to lost output from Venezuela and Nigeria and lower yields from some oil fields.
The average price of a barrel of oil was slightly less than $125 in the quarter, nearly double last year, which also increased earnings reported by three of Europe's largest oil companies, Royal Dutch Shell, Eni and Repsol.
Exxon's second-quarter net income rose 14% to $11.68 bln, or $2.22 a share, in the quarter.
However, after excluding one-time items, Exxon earned $2.27 a share, more than 10% below analysts' expectations, according to Reuters Estimates. The miss led to a 4.7% slide in Exxon's shares, a major factor in a decline in U.S. stocks on Thursday.
Shell, the world's second-largest non-government controlled oil company by market value, reported a 5% rise in second-quarter earnings to $7.9 bln, and said that excluding one-time items, it beat analysts' forecasts.
The companies' oil and gas exploration and production units were the main profit drivers because of high oil prices.
But despite blns of dollars in capital spending in the quarter, oil and gas production was sluggish. That, along with weak profit margins from refining, restrained the companies' earnings somewhat.
Western oil companies' output has fallen in recent years and oil producing countries now prefer to award their richest fields to their own national oil companies.
"The problem is that all these companies have no place to go to drill and no place to put their money," said Oppenheimer & Co analyst Fadel Gheit. "Access to resources is closing very, very fast."
Exxon's oil and gas production fell 8% from a year earlier, mostly due to the loss of assets taken over by Venezuela, a labor strike in Nigeria, and contracts that give host countries a larger share of production as oil prices rise.
Shell said output fell 1.6% in the second quarter to 3.126 mln barrels of oil equivalent per day (boepd) compared to the same quarter last year, while Repsol's production fell 19.7% to 335,000 boepd in the first half.