Refining profit margins soar, ExxonMobil (XOM.US) Q3 downstream business profit set to reach historic high
ExxonMobil stated that the rise in Q3 refining margins is expected to increase profits by about $4.5 billion, although part of the growth will be offset by falling oil prices and the timing effect of derivatives losses.
According to Jinse Finance APP, ExxonMobil (XOM.US) stated in an 8-K filing on Friday that rising refining margins in the third quarter are expected to bring about $4.5 billion in profit growth for its downstream business. In the second quarter, its refining business had already achieved $4.1 billion in profit.
Data shows that analysts expect ExxonMobil's refining profits to reach approximately $7.8 billion in the third quarter, which would be the company's best-performing quarter ever. The company is scheduled to release its full quarterly results on October 30.
As a benchmark for measuring US refining profitability, the Gulf Coast 3-2-1 crack spread rose 28% quarter-on-quarter and hit a record high of $72.64 on September 22.
The filing shows that ExxonMobil's surging profits will be partially offset by declining oil prices, which could reduce profits by about $1.3 billion. The filing also states that the company expects to incur a $2.5 billion loss due to "timing effects"—that is, derivative positions related to cargoes that have shipped but have not yet been delivered.
The company also stated that this quarter there were no volume-related disruptions caused by the Iran war.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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