ExxonMobil, 1Q Earnings Boom Due to Oil Price Surge?..."Largest Estimate Since 2008"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] U.S. energy company ExxonMobil announced that it is expected to record its highest earnings since 2008 in the first quarter of this year due to the sharp rise in oil prices caused by Russia's invasion of Ukraine.

According to major foreign media on the 4th (local time), ExxonMobil disclosed earnings estimates through a public announcement stating that its net profit for the first quarter of this year could reach up to $11 billion (approximately 13.4 trillion KRW). This is the highest level in 14 years since 2008, when oil prices nearly reached $150 per barrel, setting a record high.

ExxonMobil's strong performance was driven by the surge in oil prices following Russia's invasion of Ukraine. Due to sanctions imposed by Western countries such as the U.S. and Europe, the use of Russian crude oil became difficult, causing oil prices to rise rapidly. The international benchmarks Brent crude and West Texas Intermediate (WTI) exceeded the $120 mark last month.

ExxonMobil stated that the net profit from its existing oil development business, the upstream oil and gas production sector, could reach $8.3 billion in the first quarter of this year. This is an increase of $2.2 billion compared to the previous quarter and the highest quarterly record since 2007. However, despite the rise in energy prices, ExxonMobil noted that overall earnings could decrease by $700 million due to price hedging and weakened profits in the chemical sector.

ExxonMobil's final earnings will be announced on the 29th.

This earnings estimate disclosure by ExxonMobil comes two days before global energy companies are scheduled to appear before Congress. Executives from oil companies including ExxonMobil CEO Darren Woods, Chevron, BP, and Shell are expected to testify before the House committee and share their views on high oil prices.