Coasting on high oil prices, the world's largest publicly traded oil company posted profits on Tuesday.
But take high oil prices away, and analysts say Exxon's future looks grim.
"The way they made their money was all on price. Oil prices at $100-plus cover a lot of mistakes. On volumes they lost about a $1.5 billion; we just don't see that improving," said Chris Edmonds, managing partner at Enerecap Partners.
Shares moved lower on ExxonMobil'searnings announcement.
Expenses are a concern. The cost of producing oil from "upstream" (exploration and extraction), and "midstream" (pumping into pipeline) is increasing, and Edmonds thinks Exxon will have a hard time keeping up.
"They spent $10 billion in capital expenditures [physical, durable investments such as an oil rig] this year. That's exactly what they spent last year this quarter, and yet their volumes are down 4-5 percent — and that's just the upstream business," added Edmonds.
They say in business, you've got to spend money to make money, and Exxon's CEO Rex Tillerson is known for it.
Exxon will spend $3 billion in Russian arctic oil exploration alone, where other big oil investments have been burned.
Phil Weiss, energy analyst for Argus Research, told CNBC that this is "par for the course" in the race for oil resources.
"You have to take the risk, and it's worth taking the risk in Russia, especially if you have a balance sheet like Exxon does," he said in a separate interview.
But while the company's going big in Russia, its light alternative energy footprint may be giving competitors an advantage.
"I think Exxon's probably in the lower tier of those companies — Shell , Chevron, and ConocoPhillips, which are committed to diversified, unconventional forms of energy. That's the wave of the future," said Edmonds.
Alternative energy is also the reason Weiss prefers Chevron .
"If I was to choose, I would take Chevron over Exxon because of its production profiles," he said.
But for now, dependence on crude is the dominant driver of profits, and Exxon may yet come out on top.
"It's a relatively safe long-term investment, and I think it is undervalued," said Weiss.
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Phil Weiss of Argus Research does not own XOM. Enerecap Partners could not be reached for disclosure information.