Disappoints? This is bad news? To some, it is.
But even as it posted the second-most profitable quarter in its history, Exxon’s earnings managed to disappoint investors because of a drop in oil production. Shares were down more than 3 percent Thursday after the company missed earnings estimates by a dime a share.
In the refining business, profit margins have plummeted as refiners have been unable to pass through all the increases in oil prices onto gasoline.
The lowest price for a gallon of gas that I've seen in the last four days is $3.769 a gallon. On April 17 I paid 3.379, on the 12th 3.439; on March 11 I paid 3.299 and on the 1st had paid 3.199 -- meaning that in two months the cost of a gallon has gone up 57 cents. When I fill up later, 12 gallons will cost me $6.84 more than it would have on 1 March. 7 bucks!
While energy companies have no control over the price of oil, which is set on international futures markets, they have benefited from the rally in commodity markets. Exxon, for example, earned over $163 billion from 2003 to 2007. Oil prices more than quadrupled during that period.
163 billion in 5 years equals an average of 32.4 billion; Uganda's annual GDP is 32 billion.