Oil's well

28 October 2010 By Christopher Swann

The oil giant’s shareholders have been sulking since last year’s purchase of gas firm XTO. Another forecastbeating quarter was never going to restore the romance. Exxon could woo investors with higher buybacks. But restraint and patience may be a better longterm strategy.

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Exxon Mobil, the world's largest publicly traded oil company, said on Oct. 28 its quarterly profit rose 55 percent, topping expectations, as higher crude prices and improved refining margins boosted results.

Thirdquarter earnings for energy companies have been helped by a rebound in oil and natural gas prices. Slow improvement in the global economy has also lifted demand for fuels like diesel and gasoline, helping refining businesses.

Compared with a year earlier, crude oil prices have climbed 13 percent while benchmark gas on the New York Mercantile Exchange rose 23 percent to average $4.23 per million British thermal units.

Exxon's $27 billion acquisition of XTO Energy has boosted its natural gas portfolio, but the purchase was well received by some investors eyeing current depressed prices for the fuel.

Exxon said its thirdquarter profit was $7.35 billion, or $1.44 per share, compared with $4.73 billion, or 98 cents per share, in the yearago third quarter. Wall Street analysts on average had expected a profit of $1.39 per share, according to Thomson Reuters I/B/E/S.

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