3 Big Oil Companies Post Lower 4th-Quarter Results

Three of the nation’s four largest oil companies reported lower fourth-quarter earnings Tuesday, citing lower margins from their exploration and production operations because of the weakness of crude oil prices.

Exxon Corp., the nation’s largest oil company, said its fourth-quarter earnings fell 11% to $1.38 billion from $1.55 billion in 1987. Revenue increased to $22.02 billion from $21.08 billion.

No. 2 Mobil Corp. said its net income, including its discontinued Montgomery Ward operations, fell 1% to $469 million. Revenue decreased to $13.89 billion from $14.21 billion.

No. 4 Chevron Corp. reported fourth-quarter 1988 earnings of $175 million, down 25% from $234 million in 1987. Revenue decreased to $6.9 billion from $7.4 billion.

Production Earnings Down

Texaco Inc., the nation’s third-largest oil concern, has not yet reported its 1988 earnings.

Analysts said the results were no surprise, and Exxon closed up 50 cents at $45.20 on the New York Stock Exchange, Mobil closed off 12.5 cents at $47.38 and Chevron slipped 37.5 cents to $48.50.

“The earnings were pretty much in line,” said George Friesen, analyst with Dean Witter Reynolds. “There were very few surprises.”

“Earnings in exploration and producing were down from last year, but refining and marketing were up strongly. And of course, chemicals did well as they have all year,” said Paul Mlotok, industry analyst with Salomon Bros.

New York-based Exxon said earnings from its crude oil exploration and production operations, which had been weak throughout the year, continued to fall in October and November before partially recovering in December.

Refining Profit Up

Oil prices hovered around $14 a barrel through most of the fourth quarter, falling as low as $12.28 in early October, before recovering after an OPEC meeting in late November, when tighter output quotas were adopted. Prices ended the year at about $17.25.

Exxon said it earned $504 million from its exploration and production operations in the fourth quarter, down sharply from the $989 million earned in the 1987 period.

However, its refining and marketing operations earned $555 million, compared to $374 million in 1987. Chemical earnings totaled $343 million.

For the year, Exxon said it earned $5.26 billion on revenue of $87.54 billion, compared to $4.84 billion and $83.33 billion. The company’s chemical operations earned a record $1.31 billion.

New York-based Mobil said its refining and marketing results were helped by a $68-million gain on the sale of its Ferndale, Wash., refinery to British Petroleum Co.

For the year, the company earned $2.09 billion on revenue of $54.88 billion, compared to a year earlier when it earned $1.35 billion on revenue of $51.39 billion.

San Francisco-based Chevron said its profit for all of 1988 rose to $1.77 billion from $1.25 billion in 1987. Revenue eased to $28.9 billion from $29.1 billion.

It said its U.S. refining and marketing operations earned $571 million in 1988, up sharply from $117 million in 1987. But U.S. exploration and production earnings fell to $16 million from $381 million in 1987, the company said.