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Oil Companies See Huge Profits, Slowing Production

Higher oil prices are turning into higher profits for the world's leading oil companies, but there are indications the trend may not last.

U.S.-based Exxon Mobil says Thursday profits jumped 58 percent to a record $15 billion for the three months from July to September the third quarter. And Europe's top oil company, Royal Dutch Shell, says its profits for the same period climbed 22 percent to more than $8 billion.

Earlier this week, British Petroleum and Conoco Phillips also announced a big jump in earnings.

The big profits came as crude oil prices hit a record high of more than $147 a barrel in July. But since then, prices have been sliding.

Crude oil for future delivery fell $1.50, to less than $66 a barrel at the close of trading today in New York. Investors are concerned a contracting U.S. economy - in addition to the worldwide economic slowdown - will cut demand for energy.

There also are concerns about supplies.

Both Exxon Mobil and Royal Dutch Shell warn production has fallen by about seven percent. And Exxon says it is now spending more money to find new sources of oil.

Meanwhile, officials at Royal Dutch Shell say they will wait to expand its oil-sands operations in Canada. They blame the combination of rising labor costs and lower oil prices.

Oil prices hit a 17-month low earlier this week on concerns that a worldwide economic slowdown would cut demand for energy.

Thursday, Venezuela's oil minister called on OPEC (the Organization of Petroleum Exporting Countries) to further cut output by at least one million barrels a day.

OPEC members agreed to cut production by more than five percent last week.

OPEC produces about two-fifths of the world's oil.

Some information for this report was provided by AFP, AP and Reuters.