Exxon Mobil Corporation (NYSE:XOM) had another strong showing in the third quarter of its fiscal year, despite the fall in crude oil prices at the same time span. Exxon Mobil Corporation (NYSE:XOM) diluted earnings rose by 5.6% year on year, to $1.89 per share. Its realization price for crude oil fell by 10%, as compared to the third quarter of the previous year. This was due to the fact that crude oil benchmark has fallen quite sharply across the globe over the past few weeks. There has been a rise of supplies, but at the same time the demand for crude oil has fallen to such an extent that a country such as China’s demand for crude oil has become half of what it used to be a year ago.
Exxon Mobil Corporation (NYSE:XOM) earnings are still expected to rise slightly, on to better thicker downstream margins and better upstream. The world’s largest publically traded oil and gas stock generates revenue that go in excess of $420 billion, and it is expected that the profit for the company will stand at $7.54 per share for the current quarter, if the strong performance of the companies continues in the final quarter of the fiscal year. Exxon Mobil Corporation (NYSE:XOM) sold liquid hydrocarbons which include crude oil, natural gas liquids, bitumen oil contributed to a better upstream volume. Liquid hydrocarbons have a better and higher price realization than natural gas. Exxon Mobil Corporation (NYSE:XOM) had a price realization of $41 per barrel. The proportion of liquids from crude oil therefore happens to be the key driving factor in cash margins that are earned by production and exploitation companies by barrels of oil equitant. Hence, Exxon Mobil Corporation (NYSE:XOM) is continuously trying to improve the percentage of liquids in its production mix by slowing down its development program of shale gas in the United States. The percentage of liquid in the production mix stood at 51.5% in 2012 and 52.7 % in 2013, and it is expected that the proportion will rise in 2014.
The first nine months saw a decrease in the production capacity of Exxon Mobil Corporation (NYSE:XOM), as its liquid production reduced by 104,000 barrels per day, when its contract to explore and produce crude oil in Abu Dhabi expired. Exxon Mobil Corporation (NYSE:XOM) lost its 75 year old rights to the emirate’s oldest producing fields in January of this year. However its liquid production actually increased for the year on year, by 1.4% for the first 3 months of the fiscal year. However, its natural gas production was down by 5.8% year on year, as its production of natural gas declined by more than 700 million cubic feet per day. Exxon Mobil Corporation (NYSE:XOM), however, still expects its liquid production to increase by at least 2% when its fiscal year ends while expecting the natural gas production to decrease by 3% year on year. This will help in better price realization per barrel of oil and will drive profits upwards.