Exxon guns for all-time profit record

[L.A. BRONCOS FAN]

Looks like somebody doesn't need a stimulus package...

By Steve Hargreaves, CNNMoney.com staff writer
January 23 2008: 1:29 PM EST



NEW YORK (CNNMoney.com) -- Exxon Mobil, the world's largest publicly traded oil company, is within striking distance of setting an all-time profit record - again.

Analysts are expecting the company to post solid quarterly and full-year earnings next Friday (see correction below) - and if the results top forecasts, Exxon (XOM, Fortune 500) could end up reporting the highest profit ever for a U.S. company.

With oil prices having recently crossed the $100 a barrel threshold, it comes as no surprise that Exxon is a whisker away from setting a new milestone.

"Exxon is likely to have record quarterly earnings," said Fadel Gheit, a senior energy analyst at Oppenheimer. "For every $1 [increase] in the price of oil, Exxon makes [another] $125 million for the quarter."

When asked if Exxon could top profit records, another analyst said: "That's not out of the realm of possibility."

The company is expected to earn $10.37 billion in the fourth quarter, according to earnings tracker Thomson Financial. That's about $330 million shy of Exxon's previous quarterly profit record of $10.7 billion set in the fourth quarter of 2005 - which also was a record for any U.S. corporation.

Exxon is expected to make $39.2 billion for all of 2007, just shy of its previous record of $39.5 billion in 2006, which breaks down to the company earning about $75,000 a minute.

If ConocoPhillips is any indication, Exxon should have no trouble meeting - and beating - estimates.

Conoco (COP, Fortune 500), the nation's third largest oil company, trounced profit estimates by nearly 25 percent when it reported Wednesday morning.

Number two Chevron (CVX, Fortune 500) is also expected to do well. Analysts are expecting a 30 percent increase in earnings per share when it reports next Friday.
Oil stocks: Best picks for 2008

High crude prices have been the main factor behind the massive profits at oil firms.

Crude prices averaged $90 a barrel the fourth quarter, up 50 percent from the same period in 2006. They jumped 20 percent from the third quarter of 2007.

"That's what's really driving it here," said Robert Plexman, an analyst at CIBC World Markets.

Natural gas prices have also increased compared to last year, albeit marginally.

But costs have also increased for the oil companies, and they haven't been able to make as much selling gasoline, which is why profits haven't risen as rapidly as crude prices.

Slack demand for gasoline in the latter half of last year kept gas prices from rising as much as crude prices. Big oil companies that both pump oil and refine crude into gasoline have to spend more for crude but are unable to pass on all the extra cost to consumers, which eats in to gasoline profit margins.

That was the main reason oil companies reported earnings in the third quarter of 2007 that fell from the prior year. But profit on gas sales has improved somewhat in the fourth quarter, so it shouldn't be as big of a drag on earnings.

Finding oil has also become more costly. The oil boom has led to a surge in exploration and drilling activity, which has pushed up the price for skilled workers and equipment.

Furthermore, new supplies of oil are increasingly difficult to find and generally tend to be located in harder to reach - and hence more expensive - places. The new natural gas field discovered this week by Brazil's Petrobras lies under three miles of ocean.

Analysts say the big oil companies are having a hard time finding new oil.

"The big issue everyone will be looking for is production numbers," said Wesley Ralston, an integrated oil analyst at the New Orleans-based investment bank Howard Weil. "It's tough to offset the natural decline curve."

http://money.cnn.com/2008/01/23/news...ion=2008012310

[Rohirrim]

Yay! Go Exxon! Maybe we should expand their taxpayer subsidy?

[L.A. BRONCOS FAN]

Originally Posted by Rohirrim

Maybe we should expand their taxpayer subsidy?

Why, yes!

Remember - when he took office, Dim Son said this sort of thing would stimulate the economy.

And everybody knows how successful trickle-down economics were during the Raygun/Poppy era.

[Rohirrim]

Originally Posted by L.A. BRONCOS FAN

Why, yes!

Remember - when he took office, Dim Son said this sort of thing would stimulate the economy.

And everybody knows how successful trickle-down economics were during the Raygun/Poppy era.

What's the matter? You don't feel stimulated?

[spdirty]

wish I worked at exxon.

[Rohirrim]

Originally Posted by spdirty

wish I worked at exxon.

Not me. I despise that oil smell and I hate heat. I couldn't stand the desert. When I was getting out of the army I received a letter from Bendix offering me a lucrative position in Saudi Arabia training their military in the use of infantry weapons systems. I thought about it for a few days, but then I realized I just didn't want to live in the desert for six months with no women, no booze, etc.

[spdirty]

Originally Posted by Rohirrim

Not me. I despise that oil smell and I hate heat. I couldn't stand the desert. When I was getting out of the army I received a letter from Bendix offering me a lucrative position in Saudi Arabia training their military in the use of infantry weapons systems. I thought about it for a few days, but then I realized I just didn't want to live in the desert for six months with no women, no booze, etc.

OK, let me rephrase...I wish I was an Exxon exec.

[Rohirrim]

Originally Posted by spdirty

OK, let me rephrase...I wish I was an Exxon exec.

Maybe then you'd get a chance to hit on Condi, eh?

[spdirty]

Originally Posted by Rohirrim

Maybe then you'd get a chance to hit on Condi, eh?

you kiddin me? Shlt, Im doing monthly trips to Costa Rica, Thailand, and the Philippines.

On the private jet.

Oh well, someday Ill get there.

[Spider]

Originally Posted by spdirty

wish I worked at exxon.

There are more important things then money ....... I agree love is more important then money until you meet the cashier at the store ....But put in a honst days work , expect a honest days pay ......

[baja]

Are you a stewardess?

[spdirty]

Originally Posted by Spider

There are more important things then money ....... I agree love is more important then money until you meet the cashier at the store ....But put in a honst days work , expect a honest days pay ......

Man, Wednesday I was about the most miserable sob you could find...It was 20 degrees and the wind blowing made it feel like it was below 0 (wheres your I'd like to crawl in the same snuggie withing global warming when I need it Al??) had to drill 15 holes with about the cheapest skidsteer my old man could find. And it was in one of those ritzy ass neighborhoods in Tallyns Reach. Man, there was so much shlt underground, 2 million watt power lines, high pressure gas lines, fiber, comcast. The kind of shlt that will not only kill me if I hit it, but bankrupt our company.

Add to that the locate guys could not get their shlt together. Just miserable, nerveracking, oh, then I had the soccer-SUV moms whizzing by me.

Most of the time I love my job with a passion, but ugh, after that day I had to go buy me a powerball ticket.

[Spider]

Originally Posted by spdirty

Man, Wednesday I was about the most miserable sob you could find...It was 20 degrees and the wind blowing made it feel like it was below 0 (wheres your I'd like to crawl in the same snuggie withing global warming when I need it Al??) had to drill 15 holes with about the cheapest skidsteer my old man could find. And it was in one of those ritzy ass neighborhoods in Tallyns Reach. Man, there was so much shlt underground, 2 million watt power lines, high pressure gas lines, fiber, comcast. The kind of shlt that will not only kill me if I hit it, but bankrupt our company.

Add to that the locate guys could not get their shlt together. Just miserable, nerveracking, oh, then I had the soccer-SUV moms whizzing by me.

Most of the time I love my job with a passion, but ugh, after that day I had to go buy me a powerball ticket.

I can relate out in sub zero weather messing with Chains ,tire chains , what not , a driver door that leaks air , sometimes you get so chilled it takes hours to warm up ....ears nose , fingers literaly hurt like hell when they warm up .......I fixed that driver door