Exxon's Production Falls as Profits Soar

ExxonMobil's (XOM) third-quarter earnings demonstrate the mixed universe occupied by Big Oil as a whole today—the company reported record profits but its lowest production volume in almost a decade. The Irving (Tex.)-based corporation says it earned $14.8 billion in the third quarter, an increase of 58% from the same period last year.

............

In an unusual statement in the earnings report, Exxon Chairman Rex Tillerson sought to calm any worries about the company's strength amid the global financial meltdown and reassure investors that the company's capital spending plans remain intact. "Despite the continuing uncertainty in world financial markets, ExxonMobil has maintained a strong financial position," Tillerson said. "We plan to continue our disciplined capital investments with our full-year capital and exploration expenditures projected to be about $25 billion, consistent with previous guidance."

Revenue for the quarter was $13.7 billion, 34% higher than the same period last year. The company earned $2.59 a share excluding special items, or 20¢ higher than the $2.39 expected by analysts.

The above topic is ZZed from Busienss Week October 30,2008. In the ardent discussion, one reader's comment is quite to the point, which contends that it is natural for XOM to profit during the volatile barrel prices of oil since they can hedge their price better according to both upward and downward swings in the barrells prices..... Smart businesses alwasy prevail, and this giant has taken the best position in such a volatile time for most other companies. ...Cash is KING, and Exxon.Mobile is a cash cow. (原来英语里"**是王道"竟可以这么直译的).

Most of the time we talk about how existing asymmetric position in the market (may it be the sequence in decision or capital accumulation) will be self-enhanced. I ever wonder whether there has been any formal extrapolation regarding the role of uncertainty or information flow pattern as an amplifier of this self enhanced effect. Also,  to what extent the volatile market favors the monopoly dispite the flexibility they sacrifice for their scope of operations.