### Exxon Mobil Exceeds Profit Expectations Despite Challenging Market Conditions

Exxon Mobil outperformed Wall Street's third-quarter profit forecasts, achieving a solid $8.6 billion in earnings, largely as a result of increased oil output. This quarter marks the first full reporting period that includes production volumes from U.S. shale producer Pioneer Natural Resources following Exxon's acquisition.

Despite a year-over-year profit decline of 5%, Exxon fared better than competitors BP and TotalEnergies, who suffered more significant drops. The company reported a profit of $1.92 per share, surpassing the $1.88 per share anticipated by analysts, primarily due to higher oil and gas production and controlled expenditure.

Exxon Mobil's finance chief, Kathryn Mikells, attributed a notable 25% year-on-year increase in oil and gas output, reaching 4.6 million barrels per day, to several production records set throughout the quarter. Consequently, Exxon shares saw a 1.9% increase in premarket trading, rising to $119 per share.

Earlier in the month, Exxon hinted that operating profits might dip, prompting analysts to lower their quarterly earnings outlook marginally. However, the results exceeded these revised expectations, bolstered by the acquisition of Pioneer Natural Resources. This $60 billion transaction significantly boosted production in the U.S. shale basin to nearly 1.4 million barrels per day of oil and gas, countering a 17% drop in average oil prices for the quarter ending September 30.

Moreover, Exxon has announced a 4% increase in its quarterly dividend, reflecting a free cash flow generation of $11.3 billion—well beyond analyst predictions. In contrast, rivals Saudi Aramco and Chevron have resorted to borrowing this year to support shareholder returns amidst heightened dividend and buyback activities to entice investors.

Although Exxon did not offer a fourth-quarter outlook, it plans to update investors with a revised production forecast next month. The market remains jittery about the potential mismatch between oil supply and demand, with OPEC potentially adding 180,000 barrels per day of supply in December and overall oil prices down approximately 12% from June's average.

Exxon's refining segment experienced pressure, with earnings from gasoline and diesel production falling to $1.3 billion from $2.44 billion a year earlier. This decline was partly due to weaker margins and a refinery outage in Illinois that analysts estimate impacted operating profits by about $250 million.

Despite these challenges, Mikells noted that per unit refining margins have about doubled since 2019 on a constant margin basis, illustrating resilience within the refining business. In the chemical sector, Exxon's profits rose to $893 million from $249 million a year ago, benefitting from slightly improved margins and the company's strong Gulf Coast presence, which leverages favorable natural gas prices.