Falling Oil and Gas Prices Pressure ExxonMobil’s Earnings
ExxonMobil, the largest oil producer in the United States, has issued a warning about a significant drop in its second-quarter earnings for 2025, citing declining prices for crude oil and natural gas. In a regulatory filing released late Monday after US markets closed, the company estimated that its profit could be around $1.5 billion lower than the previous quarter.
The average price of Brent crude fell by 11% during the second quarter, settling at $66.71 per barrel. Meanwhile, US natural gas prices declined by 9%. The drop in prices has largely been attributed to an increase in supply from the OPEC+ alliance.
ExxonMobil’s guidance is widely viewed as a key indicator for the oil industry. Analysts surveyed by LSEG expect an adjusted profit of $1.53 per share for the quarter. Final figures are scheduled to be published on 1 August. In the first quarter, ExxonMobil reported a net profit of $7.71 billion.
Breakdown of the Financial Impact
According to the company’s statement to the US Securities and Exchange Commission (SEC), the weaker commodity prices could reduce upstream earnings—those related to oil and gas production—by as much as $1.9 billion compared to the first quarter.
Specifically, ExxonMobil anticipates a negative impact of between $800 million and $1.2 billion due to lower prices for liquids such as crude oil and condensates. Additionally, falling gas prices could reduce profits by another $300 million to $700 million. The combined average effect is around $1.5 billion, according to the filing.
Market Conditions Weigh on Revenue
ExxonMobil confirmed that in the second quarter, the average Brent crude price fell 11% quarter-on-quarter to $66.71 per barrel, while natural gas prices declined 9% over the same period. These price drops directly reduce revenue from upstream operations, cutting into the company’s profit margins.
The report also highlighted potential timing effects from unsettled derivative contracts, which could either lower profit by up to $300 million or boost it by up to $100 million, depending on market developments.
Refining Offers Partial Relief
Despite the challenges in the upstream segment, ExxonMobil expects some relief from improved performance in its downstream operations, particularly in refining. Favourable market conditions could lift earnings from energy products by $100 million to $500 million.
A slight positive contribution is also forecast for the specialty products segment, with potential gains ranging from $0 to $200 million.
Tesla Plant Disrupted by Border Checks
Meanwhile, new border controls between Germany and Poland are causing significant disruptions to industry in eastern Germany, particularly affecting Tesla’s factory in Grünheide, just outside Berlin.
Following tighter border regulations introduced by the German government, Poland has implemented its own checks. The Chambers of Industry and Commerce (IHKs) in Brandenburg have expressed serious concern, saying in a letter to Interior Minister Alexander Dobrindt that the economic impact could be severe.
“These measures are severely harming Brandenburg’s business environment and negatively affecting around 80,000 companies,” the letter stated, as reported by Handelsblatt.
Large firms like Tesla, along with many small and medium-sized businesses—especially those in the logistics sector—are reportedly seeing major disruptions in their operations. A particular concern is the cross-border commuter traffic, which has been heavily affected by Poland’s response to Germany’s stricter checks.
Tesla’s Grünheide gigafactory employs roughly 11,000 people, many of whom live in Poland. The ongoing border issues have raised alarms over the stability of daily operations at the site.