High Oil Prices Fuel Exxon Mobil Profit

Exxon Mobil Corp. (XOM), the world's largest publicly traded oil company, on Monday reported the highest quarterly profit in its history, driven by lofty crude oil and natural gas prices (search).

The results easily topped Wall Street forecasts and capped an exceptional year for the Irving, Texas, company, among the biggest beneficiaries of a dramatic ascent in crude oil prices last year.

Indeed, Exxon's profit of more than $25 billion for the full year -- also its highest on record -- surpasses the gross domestic product of countries like Guatemala and Syria.

Exxon, whose shares rose slightly in early trading, said net income in the fourth quarter increased to $8.42 billion, or $1.30 a share, from $6.65 billion, or $1.01 a share, a year earlier. Analysts' average forecast was $1.05 a share, according to Reuters Estimates.

"This is a particularly impressive set of results given that every segment outperformed expectations," Credit Suisse First Boston analysts said in a research note.

Revenue shot up to $83.36 billion from $65.95 billion a year earlier.

Surging demand from fast-growing Asian giants India and China, coupled with fears of a disruption in supplies from countries such as Russia, Iraq and Nigeria, kept oil prices surging for much of the past year. Crude prices topped $55 a barrel in late October.

All three major business lines at Exxon posted higher earnings.

The rise in prices drove earnings at its exploration and production unit to $4.89 billion, up from $3.27 billion a year earlier. Profit from refining and marketing operations tripled, to $2.34 billion from $736 million a year earlier, on strong refining margins.

Healthy worldwide demand pushed up earnings at its chemicals business to $1.25 billion from $476 million.

Oil and gas production fell 2 percent in the quarter, hurt by divestments and the impact of higher prices on production-sharing agreements.

Capital spending also fell slightly, to $4.23 billion from $4.36 billion a year earlier.

Exxon shares were up 42 cents to $51.69 in early trading on the New York Stock Exchange (search).