⚠ Sixty-Three Cents of Every Dollar of Cost Is a CommodityHigh threat

ExxonMobil (XOM) — threat to the moat

Sixty-three cents of every dollar ExxonMobil spends is a commodity bought at a price it does not set.

ExxonMobil's income statement contains a line that settles most arguments about what kind of company this is. Crude oil and product purchases in 2025 were $184,248 million against total costs and other deductions of $290,970 million1. Sixty-three cents of every dollar the company spends is a commodity bought at a published price it does not set.

Total costs and deductions, 2025: $290,970 millionCrude oil and product purchases $184,248m — 63%Other taxes and duties $25,167m — 9%Depreciation and depletion $25,993m — 9%Production and manufacturing $42,424m — 15%SG&A, exploration, R&D, other $13,138m — 5%Everything ExxonMobil’s 57,900 employees do costs about $56bn.
Sixty-three cents of every dollar spent is a commodity bought at a price ExxonMobil does not set.

Compare that with the lines management can actually influence. Production and manufacturing expenses were $42,424 million; selling, general and administrative $11,128 million; exploration $1,007 million; research and development $1,228 million2. Everything ExxonMobil's 57,900 employees3 do costs about $56 billion, against $184 billion of purchased hydrocarbons.

This is why cost programmes in this industry do less than they appear to. The $15.1 billion of cumulative structural cost savings ExxonMobil has delivered since 20194 is an impressive number against a $56 billion controllable base and a small one against $184 billion of purchases plus a price that moves $700 million of earnings per dollar of Brent5.

It also explains the revenue line's behaviour. Sales rose from $178,574 million in 2020 to $398,675 million in 20226 and back to $323,905 million in 20257 with the physical business changing far less than that. A company that buys most of what it sells has revenue that is largely a price index, and analysts who model it as a growth rate are modelling the oil market.

The defence is the one integration provides: when the purchase price rises, the segment buying is hurt and the segment selling is helped, which is why ExxonMobil's earnings are less volatile than its revenue. The defence does not make the purchases smaller.

The ratio itself is the test. Crude oil and product purchases were 63.3 per cent of total costs in 2025, 66.3 per cent in 2024 and 66.2 per cent in 20238. A structurally falling ratio would mean ExxonMobil is producing more of what it sells and buying less. It is not moving.

References
  1. ReportedCrude oil and product purchases in 2025 were $184,248 million against total costs and other deductions of $290,970 million.
    Exxon Mobil Corporation Form 10-K for FY2025, consolidated financial statements — statement of income, balance sheet, statement of cash flows and statement of changes in equity including the common stock share activity table. — FY2025 · publ. February 2026 · source ↗
  2. ReportedProduction and manufacturing expenses were $42,424 million; selling, general and administrative $11,128 million; exploration $1,007 million; research and development $1,228 million.
    Exxon Mobil Corporation Form 10-K for FY2025, consolidated financial statements — statement of income, balance sheet, statement of cash flows and statement of changes in equity including the common stock share activity table. — FY2025 · publ. February 2026 · source ↗
  3. ReportedEverything ExxonMobil's 57,900 employees do costs about $56 billion, against $184 billion of purchased hydrocarbons.
    Exxon Mobil Corporation Form 10-K for FY2025, Financial Information summary — sales and other operating revenue, net income, earnings per share, return to average equity, working capital, additions to property plant and equipment, long-term and total debt, debt and net debt to capital, equity per share, research and development, and the number of regular employees. — FY2025 · publ. February 2026 · source ↗
  4. ReportedThe $15.1 billion of cumulative structural cost savings ExxonMobil has delivered since 2019 is an impressive number against a $56 billion controllable base and a small one against $184 billion of purchases plus a price that moves $700 million of earnings per dollar of Brent.
    Exxon Mobil Corporation Form 10-K for FY2025, Market Risks — worldwide average realisations for Brent, Henry Hub and TTF, and the disclosed sensitivity of Upstream earnings to a one dollar change in Brent, a ten cent change in Henry Hub and a ten cent change in TTF. — FY2025 · publ. February 2026 · source ↗
  5. ReportedThe $15.1 billion of cumulative structural cost savings ExxonMobil has delivered since 2019 is an impressive number against a $56 billion controllable base and a small one against $184 billion of purchases plus a price that moves $700 million of earnings per dollar of Brent.
    Exxon Mobil Corporation Form 10-K for FY2025, Market Risks — worldwide average realisations for Brent, Henry Hub and TTF, and the disclosed sensitivity of Upstream earnings to a one dollar change in Brent, a ten cent change in Henry Hub and a ten cent change in TTF. — FY2025 · publ. February 2026 · source ↗
  6. ReportedSales rose from $178,574 million in 2020 to $398,675 million in 2022 and back to $323,905 million in 2025 with the physical business changing far less than that.
    Exxon Mobil Corporation Form 10-K for FY2022, consolidated statement of income — sales and other operating revenue and net income attributable to ExxonMobil for 2022, 2021 and 2020, including the record $55,740 million earned in 2022. — FY2020-FY2022 · publ. February 2023 · source ↗
  7. ReportedSales rose from $178,574 million in 2020 to $398,675 million in 2022 and back to $323,905 million in 2025 with the physical business changing far less than that.
    Exxon Mobil Corporation Form 10-K for FY2025, consolidated financial statements — statement of income, balance sheet, statement of cash flows and statement of changes in equity including the common stock share activity table. — FY2025 · publ. February 2026 · source ↗
  8. Moat Explorer calcCrude oil and product purchases were 63.3 per cent of total costs in 2025, 66.3 per cent in 2024 and 66.2 per cent in 2023.
    Moat Explorer calculation from ExxonMobil's reported figures. Crude oil and product purchases of $184,248 million against total costs and other deductions of $290,970 million is 63.3% (2024: $199,454m of $300,712m = 66.3%; 2023: $193,029m of $291,799m = 66.2%). Intersegment revenue of $121,005 million against gross segment revenue of $452,209 million is 26.8%. Depreciation and depletion of $25,993 million against sales of $323,905 million is 8.0% (2023: $20,641m of $334,697m = 6.2%). Income tax of $11,504 million on pre-tax income of $41,268 million is 27.9% (2024: $13,810m of $48,873m = 28.3%; 2023: $15,429m of $52,783m = 29.2%). Revenue outside ASC 606 of $96,996 million of $323,905 million is 29.9% (2024: 27.7%; 2023: 23.4%). The three downstream segments sum to $17,493m (2023), $9,662m (2024) and $11,080m (2025), a rise of $1,418m in 2025 against an Upstream fall of $4,036m. Refinery throughput of 3,979 against production of 4,736 thousand barrels a day is 0.84. Specialty Products earned $2,857m on 7,791 thousand tonnes ($367/t) against $3,052m on 7,666 ($398/t). Free cash flow of $51,970m less $28,358m is $23,612m against distributions of $17,231m plus $20,273m = $37,504m. Energy Products averaged $7.9 billion a year across 2023-2025. — FY2023-FY2025 · publ. September 2026 · source ↗
Sources
Generated September 23, 2026