ExxonMobil said on Friday that markedly stronger refining margins during the third quarter are likely to increase its downstream adjusted profit by about $4.5 billion compared with the prior three months.
According to the company’s regulatory filing, adjusted net income for the refining segment could rise to $8.5 billion. That figure would represent more than twice the profit recorded in the previous quarter, a jump highlighted in a research note by BMO Capital Markets analyst Phillip Jungwirth.
Drivers cited in the filing
- Exxon attributed the refining margin strength, in part, to two supply-side developments. The ongoing Iran war has restricted energy shipments through the Strait of Hormuz, and Ukrainian attacks have affected Russian refinery operations.
- Those dynamics have supported higher fuel prices, which the filing notes have also created political risk for the administration of US President Donald Trump ahead of the November midterm elections. The company’s expected refining gains may intensify public scrutiny - the president complained in August that Exxon and Chevron were making "too much money".
Impacts elsewhere in the business
The filing also outlined headwinds for Exxon’s upstream business in the third quarter. The company estimated that upstream earnings could decline by $1.3 billion versus the second quarter, reflecting a drop in benchmark crude prices. LSEG data cited in the filing show the average closing Brent benchmark price fell about 5.6% during the third quarter compared with the prior three months.
Exxon said it did not experience any volume-related disruptions during the quarter that it could directly attribute to the Iran war. Separately, the company indicated that proceeds or accounting effects from planned divestments of some upstream assets will increase earnings by about $700 million.
Market reaction and near-term timetable
Shares of ExxonMobil were modestly higher in pre-market trading, rising by less than 1% ahead of the company’s full third-quarter results, which are scheduled for release on October 30. The filing and analyst commentary provide an early look at how margin swings and crude price moves are reshaping earnings across the company’s refining and upstream segments.
This disclosure highlights the sensitivity of integrated oil companies to rapid shifts in refining margins and benchmark crude prices, and it frames a near-term earnings picture in which downstream performance could substantially outpace upstream results for ExxonMobil in the third quarter.