ExxonMobil’s first quarter profits hit five-year low

• Q1 net profit falls 45% from last year
• Production also plummets
• Company predicts reverse in late 2026

Net profits at ExxonMobil fell to a five-year low in the first three months of 2026, as the US energy major revealed the extent of the Iran war’s impact on operations.

First-quarter earnings fell from $7.7 billion in 2025 to $4.2 billion, a 45 percent decline, the company said on Friday. 

Production dropped from nearly 5 million oil-equivalent barrels per day in the last quarter of 2025 to 4.6 million barrels, despite record-breaking output from Guyana.

ExxonMobil’s projected output will decline by 750,000 oil-equivalent barrels daily, or 15 percent of its global production, in the second quarter if the Strait of Hormuz remains closed.

As crude prices soared and shipping through Hormuz stopped, a mismatch between financial hedges, physical deliveries and the timing of their accounting separately led to a multi-billion dollar hit. However ExxonMobil said this would reverse later in the year. 

Adjusted for that, earnings-per-share beat analyst expectations, according to CNBC.

The market has not yet experienced the “full impact” of the “historically unprecedented disruption” to oil and gas supply, ExxonMobil CEO Darren Woods said on an earnings call. 

He cited tankers still on the way to their destinations when Hormuz closed, and the drawdown of commercial and strategic reserves as mitigating the impact. 

Woods predicted flows will take one to two months to return to normal after the strait reopens. 

“The ships have got to reposition themselves, we’ve got to work through the backlog, then there’s obviously the transit time to get the product to market,” he said.

In the long term much depends on “where Iran ends up” and how confident the industry is that operations will not face new interruptions, Woods added. 

“Whether or not a risk premium is put into the market, I think, is a question that has yet to be answered,” he said.

• Worldwide oil inventories could sink to record lows
• IEA chief predicts two years for Middle East energy recovery
• Free from Opec, how much can the UAE raise oil output capacity?

Woods also flagged initial production of liquefied natural gas out of one unit of ExxonMobil’s Texas joint venture with QatarEnergy, saying that this increased US exports by 5 percent over 2025 “at an important moment for global supply”.

“By the time the third train is online, we will increase the country’s current LNG exports by roughly 15 percent,” he said.

On Thursday ConocoPhillips, another US energy major, dropped Qatar from its second-quarter production guidance as LNG operations in the Gulf state paused because of Iranian attacks. 

The hits have also taken offline 100,000 oil-equivalent barrels daily for ExxonMobil. 

“That’s about 3 percent of our global production, and QatarEnergy came out very early on and said the repair time will be anywhere between three and five years,” Woods said. “Obviously, we’re working to be on the low end of that range.”

Chevron also reported its first-quarter results on Friday, and similarly beat analyst expectations for earnings-per-share while logging lower overall net profits.

The company has less exposure to the Middle East turmoil, with only 5 percent of its output linked to the region, according to Reuters.