Exxon Mobil Profit Declines 29%

Exxon Mobil Corp., the largest publicly traded oil company, said third-quarter profit fell 29% because of lower oil and natural gas prices.

Net income declined to $3.18 billion, or 46 cents a share, from $4.49 billion, or 63 cents, a year earlier. Revenue fell 9.5% to $53 billion from $58.6 billion.

A slowing economy and anxiety after the Sept. 11 terrorist attacks cut demand for fuel and chemicals made from petroleum.

“Consumers have basically stayed home, stopped spending, stopped traveling,” said Jay Wilson, a J.P. Morgan energy analyst.

Exxon Mobil’s stock fell 25 cents to $40.87 a share on the New York Stock Exchange.

Exxon Mobil, based in Irving, Texas, said net income in the latest quarter included costs of $140 million related to the merger of Exxon and Mobil. Without those costs, profit would have been $3.32 billion, or 48 cents a share.

On that basis, the company was expected to make 50 cents a share, the average estimate of analysts polled by Thomson Financial/First Call. Estimates ranged from 45 cents to 54 cents.

A year ago, net income included merger-related items that resulted in a gain of $200 million, the company said. Without that gain, profit would have been $4.29 billion, or 60 cents.

Earnings from producing oil and natural gas were $2.13 billion, down 31% from last year, due to lower prices.

Natural gas averaged $2.83 per million British thermal units on the New York Mercantile Exchange in the third quarter, 38% lower than a year earlier. The average price of oil fell 16%, to $26.50 a barrel.

Exxon Mobil’s earnings from refining crude oil into gasoline and other fuels rose 5.5% to $942 million.

Among other energy earnings reported Tuesday:

* Valero Energy Corp., which is buying rival U.S. oil refiner Ultramar Diamond Shamrock Corp., said third-quarter net income fell 21% because profit margins from selling gasoline and other fuels narrowed. Net income fell to $101.1 million, or $1.58 a share, from $127.4 million, or $2.01 a share, a year earlier. Revenue fell 9.2% to $3.86 billion from $4.25 billion.

Valero was expected to earn $1.28, the average estimate of analysts who were polled by Thomson Financial/First Call.

* Ultramar Diamond Shamrock said third-quarter profit rose 17%, partly because margins from gasoline sales improved. Net income increased to $149 million, or $2 a share, from $127.6 million, or $1.47, a year earlier. Revenue fell 11% to $4.02 billion from $4.53 billion.

Both Valero and Ultramar own refineries and gasoline stations in California.