After two consecutive good quarters, Exxon Mobil fell a little flat in its latest quarter, due to weak performance from its refining and chemical business.
The two main reasons for such a flat performance, according to the company, were lower than expected margins from the company’s refining and chemical business and second, the substantial downtime for maintenance in both its upstream and downstream businesses. Margins from the refining and polyethylene business in this past quarter were some of the lowest the company has seen in almost a decade.
A number of investors are of the opinion that this trend will continue over the next couple of years. The reason being Exxon plans to spend billions towards upgrading and retooling many of its refineries. Also, the industry as a whole will be going through significant changes over new emissions regulations passed by the IMO, which will drastically reduce fuel oil demand and simultaneously increase demand for ultra-low-sulfur diesel fuel.
However, some of the key highlights for the quarter include: ExxonMobil's production for the quarter stood at 3.98 million barrels of oil equivalent per day, more or less flat from the prior quarter but is up 5% compared to Q1 of 2018. The company's offshore Guyana program continues to reap even more rewards as it announced three additional discoveries in the quarter and raised the reserve estimate for the entire area to 5.5 billion barrels. The company also announced its investment and upgrading plans on several projects like Golden Pass LNG facility in Texas, Singapore Complex, and Fawley refinery in the United Kingdom among others.