Exxon Mobil Corporation on Thursday reported a $10.98 billion first-quarter profit, but the results still disappointed Wall Street as weak production and low refining margins reduced profits from record-high crude-oil prices. Despite missing estimates, Exxon's profits were up 17 percent from a year ago and were the second-highest quarterly profit in U.S. history. U.S. oil prices averaged a record of nearly $98 a barrel during the quarter, up about 70 percent from a year earlier. Exxon posted record profits of $40.6 billion in 2007, with revenue higher than the gross domestic profit (GDP) of Turkey, the world's 17th largest economy. If oil prices stay around or above $100 for the rest of 2008, the company could surpass last year's record. Profits were lowered as margins to produce gasoline have plunged, with refiners struggling to push higher crude costs to customers. First-quarter gasoline prices rose only 33 percent from the same period a year ago—less than half the rise in crude prices. Exxon said first-quarter revenue rose to $116.85 billion from $87.22 billion a year earlier. Profits from the company's exploration and production unit were up 45 percent to $8.79 billion, while its refining profits declined 39 percent to $1.17 billion. Oil and natural-gas production fell 5.6 percent during the quarter. Exxon said the segment was hurt by production-sharing contracts that give host countries a larger share of oil and natural gas produced as commodity prices rise, as well as the decline of older fields and the loss of operations that were nationalized by Venezuela last year.
