Friday 29 July 2016 1:54 pm

Exxon Mobil profits plummet as oil prices keep on sliding

Exxon Mobil had a difficult first half, with earnings sliding 62 per cent, results posted today showed.

The figures

Earnings fell 62 per cent to $3.5bn in its first half – and skidded 59 per cent to $1.7bn in the second quarter alone.

That pushed earnings per share down 59 per cent in the second quarter, to $0.41

Meanwhile, upstream earnings fell to $294m, down $1.7bn from the second quarter of 2015, while downstream earnings fell $681m to $825m.

Shares fell 2.5 per cent to $87.88 in pre-market trading in the US. 

Why it's interesting

Remember that time Apple knocked Exxon off the top spot as the world's largest listed company? That seems like ancient history now – earlier this week, Facebook overtook the oil giant to become the world's fourth-largest listed company

And there isn't much good news ahead: while we all thought oil had begun to pick up as US stocks showed signs of dwindling, in recent days the black stuff has been heading towards a bear market, with prices hovering around $42. 

It's a sign of the times that Exxon has scaled back its exploration costs heavily: today's results showed it has cut back by 38 per cent in the second quarter alone, spending a mere $5.2bn in the past three months. 

To be fair, Exxon isn't the only one having a tough time right now. Earlier this week Shell reported a 72 per cent drop in earnings, while BP profits have almost halved

What Exxon Mobil said

Rex W. Tillerson, chairman and chief executive officer, said:

While our financial results reflect a volatile industry environment, Exxon Mobil remains focused on business fundamentals, cost discipline and advancing selective new investments across the value chain to extend our competitive advantage. The corporation benefits from scale and integration, which provide the financial flexibility to invest in attractive opportunities and grow long-term shareholder value.

In short

Sliding oil prices continue to hit the profits of the world's largest oil majors