Exxon Mobil reported a surge in quarterly profit of more than 40%, but still fell short of estimates.
NEW YORK (CNNMoney) -- Exxon Mobil on Thursday reported a profit of $10.7 billion in the second quarter, up 41% from the prior year, driven in part by higher gas prices.
But the oil company fell short of earnings estimates.
Exxon Mobil's earnings per share were $2.18 in the second quarter, 15 cents shy of the $2.33 consensus of analysts surveyed by Thomson Reuters.
But Exxon Mobil topped revenue estimates, reporting $125.5 billion compared to the Thomson Reuters forecast of $121 billion.
Exxon's (XOM, Fortune 500) stock slipped about 2%.
"With sky high oil prices and great refining margins, Exxon is at a point where little more can go right," said Dan Dicker, former oil trader and author of "Oil's Endless Bid: Taming the Unreliable Price of Oil to Secure Our Economy."
"It's tough to improve on perfection and the shares are anticipating that they can't and are heading down, despite the good report," he said.
Exxon said that its profit reflected the higher crude oil and natural gas prices that made headlines during the three-month period.
Peter Beutel of energy risk management firm Cameron Hanover said that retail gasoline prices surged in April and early May. He said prices were driven by a weaker dollar and concerns about instability in the Middle East from the Arab Spring, as well as "some residual optimism that the economy was going to get stronger."
Gas prices soared from a nationwide average of $3.606 per gallon on March 31 to a peak of $3.975 on May 7, before dipping below $3.60 in late June, according to AAA and the Oil Price Information Service.
Exxon's fat profits inspired anger among Americans back in April, prompting the oil company to say that it was not profiting off higher gas prices.
Natural gas is also a heavy contributor to Exxon's revenue. While Exxon produced, on average, 2.35 million barrels of oil per day during the second quarter, its daily quota of natural gas was 12.36 billion cubic feet.
The company also said that its spending on oil exploration soared 58% in the second quarter to a record high of $10.3 billion.
David Rosenthal, vice president of investor relations for Exxon, said in a webcast with analysts that Exxon plans to ramp up operations in various overseas locations, including Iraq. He said the company is currently pumping 340,000 barrels of oil per day from five wells in Iraq.
"We're working on the infrastructure necessary to continue to grow volume [in Iraq,]" he said.
Rosenthal also reiterated that Exxon had discovered a new oil field in the Gulf of Mexico in June, a source of as much as 700 million barrels of oil. Furthermore, he said that Exxon is ramping up operations in Canada, Argentina, Indonesia and Poland.
Sara Nunnally, co-author of "'Barbarians of Oil," a book critical of the oil industry, said this expansion could be responsible for Exxon missing Wall Street's profit forecast.
"I think it was surprising that they didn't meet the consensus of analysts," she said. "That's probably because they are doing so much investing overseas. When you start looking for new production in those areas, it's going to impact your bottom line a little bit."
Oil industry competitors BP (BP) and ConocoPhillips (COP, Fortune 500) also reported earnings earlier in the week, while Chevron's (CVX, Fortune 500) earnings are still to come. 
