Exxon Mobil reported a profit of $9.45 billion, or $2 a share, down from $10.65 billion, or $2.14 a share, a year earlier, below analysts expectations of $2.09. The miss was driven mainly by significantly lower-than-expected chemical results and lower profits from the company's international exploration and production arm, said Fadel Gheit, an analyst with Oppenheimer & Co.
Revenue increased 8.8% to $124.05 billion.
The world's largest publicly traded oil company by market value, which has bet heavily on natural-gas production in recent years, was expected to see profit fall a because prices for the commodity had hit decade-low levels. The earnings miss sent Exxon's shares 1.68% down to $85.40.
The average price at which Exxon sold its natural-gas production in the first quarter was $2.74 per thousand cubic feet, down 20% from the same period a year earlier. The company's realized price for crude oil was $105.68 a barrel, 3% higher than a year earlier.
Exploration and production earnings fell 10% to $7.8 billion amid higher operating expenses and a 5% drop in production to 4.55 million barrels of oil equivalent per day. Excluding the impact production-sharing agreements --which give Exxon less output when oil prices go up -- OPEC quota effects and asset dispositions, quarterly production was down 1%, the company said.
The company's oil production fell 7.7% mainly due to the effect of asset disposition and production-sharing contracts. Exxon's natural-gas output declined 3.3% driven by field decline and asset sale, the company said.
Exxon's production decline shows major U.S. oil companies continue to struggle to increase their output as the reserves in their fields deplete quickly and access to new sources remains a challenge.
Refining and marketing earnings were up 44% to $1.59 billion mainly due to asset sale gains and improved volume as margins weakened.
Chemical earnings of $701 million were $815 million lower than the first quarter a year earlier on weaker margins, higher planned maintenance and the absence of favorable tax items.
Exxon Mobil, Irving, Texas, said it expects to spend $5 billion on share buybacks in the second quarter, the amount it spent in the first quarter. On Wednesday, the company increased its quarterly dividend by 21% to 57 cents per share.
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