Exxon Mobil Forecasts $2.9B Q1 Upstream Gain
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- Exxon Mobil expects Q1 upstream earnings to rise $2.1‑$2.9 billion from higher oil prices amid the Iran conflict, offsetting a 6% production dip from UAE and Qatar asset disruptions.
- Exxon says attacks on Qatar’s Ras Laffan complex damaged two LNG trains (≈3% of 2025 output) and caused a $600‑$800 million shipping impairment, while downstream earnings face a $3.3‑$5.3 billion temporary hit from derivatives and shipping timing effects.
- Neil Hansen says the downstream loss is temporary and expects profits to unwind and become material gains once shipments resume.
- UBS keeps a Buy rating and $171 price target, highlighting profit upside from a global helium shortage as Exxon's Wyoming LaBarge plant meets demand after Middle Eastern export routes close.
- U.S.–Iran ceasefire talks briefly lowered Brent crude to $92/barrel, while two vessels tested a reopening of the Strait of Hormuz, underscoring the volatile backdrop for Exxon's earnings.
Why it matters: Exxon’s upstream profit surge cushions a 6% output decline, while its downstream division endures a $3.3‑$5.3 billion short‑term loss; the helium shortage also positions the firm to capture higher margins as Middle Eastern supply falters. Investors may see a short‑term earnings dip, but the company’s ability to ride price spikes and scarce helium could translate into stronger financial results later.
