ExxonMobil Q1 Profit Falls 45.8% to $4.2B as Output Drops 8%
ExxonMobil reported first-quarter GAAP profits of $4.2 billion, down 45.8% year-over-year due to accounting timing effects, with adjusted earnings of $8.8 billion expected to reverse in future quarters. Production fell nearly 8% as Strait of Hormuz disruptions and Qatar facility attacks dented output, while California gas topped $6 per gallon.
1. First-Quarter Earnings Decline
ExxonMobil reported GAAP profits of $4.2 billion, a 45.8% drop from the year-ago period due to US accounting rules requiring immediate recognition of derivative contract losses. Excluding those timing effects, adjusted earnings reached $8.8 billion, which ExxonMobil expects to reverse in upcoming quarters.
2. Production Impact from Middle East Disruptions
Disruptions at the Strait of Hormuz and attacks on Qatar facilities reduced ExxonMobil’s output by nearly 8% versus the prior quarter. With roughly 20% of its oil and gas production located in the Middle East, the company remains highly exposed to regional supply outages.
3. Supply Risks and California Price Surge
CEO Darren Woods warned that oil prices could spike further if the Strait remains closed, noting that commercial inventories and government reserve releases are dwindling. Meanwhile, California drivers faced gas prices exceeding $6 per gallon, driven by global supply tightness and state-specific taxes and emissions standards.