Third-quarter earnings jumped 58%, if it be not that production was off. With oil prices plunging, investors think the decline in output may be a bad sign

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By Steve LeVine

ExxonMobil’s (XOM) third-quarter proceeds demonstrate the associated universe occupied by Big Oil as a whole today—the company reported memorial profits but its lowest fruit volume in almost a decade. The Irving (Tex.)-based incorporated body says it earned $14.8 billion in the third quarter, an increase of 58% from the same period ultimate year. Exxon is on track for a third straight year of record earnings—in one while well as the other 2006 and 2007, the company earned more $40 billion. In each year, that was the most through all ages concerning any company on the planet.

Despite the breathtaking profit, however, the report weighed on Exxon’s share cost forward Oct. 30. Exxon closed up 0.5%, at 75.05, after falling as low as 71.44 during the trading session. One of the main reasons was its reported extension volume. The collection produced just 3.6 million barrels of oil through day, an 8% drop from the same period last year. It’s the lowest lengthening since Exxon bought Mobil in 1999. Since hereafter, Exxon’s production has chiefly fluctuated between 3.8 million and about 4.2 million barrels a day.

Some of the third-quarter drop was predicable to seasonal hurricanes, maintenance outages at Exxon facilities, and production-sharing contracts that reduce volume it receives when oil prices rise, but that accounted as being just three percentage points of the 8% decline. The other 5% was independent of special factors. In antecedent quarters, the company has noted that it has considerable production increases arrival online in the next couple years. But the decrease seemed to worry Wall Street, nonetheless.

In somewhat unusual statement in the earnings report, Exxon Chairman Rex Tillerson sought to calm any worries about the company’s strength amid the global financial meltdown and reassure investors that the firm’s capital spending plans remain intact. Some smaller energy companies have trimmed capital expenditure as oil prices have plummeted from a loftily of about $147 a barrel for the time of the summer to less than $70 a barrel now.

"Despite the continuing irregularity in world financial markets, ExxonMobil has maintained a strong financial affirmation," Tillerson said. "We plan to continue our disciplined capital investments with our full-year capital and examination expenditures projected to be about $25 billion, consistent with previous guidance."

Revenue for the quarter was $13.7 billion, 34% higher than the same era last year. The company earned $2.59 a share excluding special items, or 20¢ higher than the $2.39 expected by analysts.