ExxonMobil and Chevron, the largest American energy companies, said on Friday that their earnings in the first quarter fell from a year earlier, pulled down by lower margins on oil refining and plunging natural gas prices.
But the oil and gas business remains highly profitable for the two giants even at a time of moderate oil prices.
The price for Brent crude oil, the international benchmark, has been rising in recent weeks and is currently just under $90 a barrel. If this upward trend continues, company earnings could rise. Brent crude is still selling for well below its 2022 peak, when it jumped above $100 a barrel after Russia’s invasion of Ukraine.
ExxonMobil said that earnings were $8.2 billion in the quarter, compared with $11.4 billion in the same period a year earlier. Chevron reported a decline to $5.5 billion, from $6.6 billion a year ago.
Both companies attributed their declines to lower profitability from refining crude oil into products like gasoline and diesel. Their earnings were also hurt by falling prices for natural gas, a key fuel that is used in heating and industry. Natural gas prices, which soared after Russia’s invasion of Ukraine in 2022, have fallen sharply as markets adjusted.
Chevron’s adjusted earnings of $2.93 per share were slightly above expectations, while ExxonMobil’s $2.06 per share were below, said Biraj Borkhataria, an analyst at RBC Capital Markets, an investment bank.
The two companies are locked in a rivalry over the oil riches of Guyana. ExxonMobil led the development of the Latin American country into the most important new oil producer in recent years.
But Chevron is trying to move into Guyana through a $53 billion proposed acquisition of Hess, a midsize company based in New York with a large stake in Guyanese oil fields.
ExxonMobil is balking at the entry of a rival into such lucrative turf and is exploring the possibility of using a legal right to acquire the Hess stake in key oil fields off the coast of the country. It has filed for arbitration over the situation.
“We have created tremendous value” in Guyana, Darren W. Woods, ExxonMobil’s chairman and chief executive, said in a statement. “We believe it is critical to defend these rights and fully preserve the value we‘ve created.”
Uncertainty over whether the merger may be in jeopardy has weighed on Chevron’s share price, analysts say. Mr. Borkhataria called the Guyana situation “the elephant in the room” for Chevron.
In its quarterly earnings report, ExxonMobil highlighted its contributions to Guyana. Mr. Woods said production there “continues at higher-than-expected levels contributing to historic economic growth for the Guyanese people.”