(Reuters) - A surge in refining profits boosted quarterly results at Exxon Mobil Corp (XOM.N) and Chevron Corp (CVX.N), helping to offset declining oil and gas production and falling crude oil prices.
Both companies reported better-than-expected third-quarter profits on Friday, with executives touting the importance of owning massive refineries alongside oil and gas wells. Refining profits tend to rise when oil prices fall, though low prices dent the profitability of wells. Having both in a company stable can allow for a bit of insurance during price swings.
"Exxon Mobil's quarterly results demonstrate the strength of our integrated business model," Chief Executive Officer Rex Tillerson said in a statement after his company posted results.
Chevron, the second-largest U.S. oil producer after Exxon Mobil, said production sagged as new wells failed to offset declines at old wells. Still, the fall in crude oil prices in recent months - down about 25 percent since July - helped profit at the company's refining unit jump nearly fourfold.
"It was a common theme for both companies," said Brian Youngberg, an oil company analyst with Edward Jones in St. Louis. "Refining exceeded expectations and basically offset lower oil prices and the lack of production growth."
Shares of Chevron dipped 0.1 percent to $117.18 while Exxon edged up 0.3 percent at $94.75.
Reporting by Anna Driver in Houston and Ernest Scheyder; in Williston, North Dakota; Editing by Jeffrey Benkoe