Recovering economies drive Exxon profit rise

 
City A.M. Reporter
Exxon Mobil has reported a better-than-expected 53 per cent increase in quarterly profit, helped by a lower tax rate and recovering world economy.

Oil demand rose last year and the US government expects another 1.5 per cent gain this year as businesses' and consumers' appetite for fuels rise as the global economy slowly mends.

Exxon reported a fourth-quarter profit of $9.25bn (£5.83bn), or $1.85 per share, compared with $6.05 billion, or $1.27 per share in the same quarter a year earlier.

The result was above consensus analysts’ forecasts for $1.63 per share.

The Texas-based company's exploration and production results were also lifted by higher oil prices, which climbed 12 per cent from a year earlier to average around $85 per barrel in the fourth quarter.

Still, Exxon's bottom line was also helped by lower taxes, an analyst said.

"A lot of the beat looks like it was on a lower effective tax rate," Phil Weiss, oil analyst at Argus Research said. "Production was really strong, but the beat really was on gas, which is not as profitable as liquids.

Oil-equivalent production rose 19 per cent from the year-ago quarter, lifted by liquefied natural gas operations in Qatar, the company said.

Revenue soared to $105.2bn from $89.8bn a year earlier.

Shares of Exxon, the world's largest publicly traded oil company, rose one per cent in premarket trading to $79.81, up from Friday's New York Stock Exchange close of $78.99.