UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

( X )   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2006March 31, 2007

or

(   )  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________to________

Commission File Number 1-2256

                                 EXXON MOBIL CORPORATION                                 

(Exact name of registrant as specified in its charter)

                            NEW JERSEY                                                             13-5409005                         

               (State or other jurisdiction of                                              (I.R.S. Employer                     

               incorporation or organization)                                        Identification Number)               

     5959 Las Colinas Boulevard, Irving, Texas                             75039-2298       

(Address of principal executive offices)                               (Zip Code)

                                         (972) 444-1000                                         

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No    

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of "accelerate"accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

         Large accelerated filer   X       Accelerated filer               Non-accelerated filer      

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes    No  X 

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

                      Class                                                                        Outstanding as of September 30, 2006March 31, 2007

Common stock, without par value                                                              5,832,488,4455,633,270,055                

EXXON MOBIL CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2006MARCH 31, 2007

TABLE OF CONTENTS

Page

Number

PART I.  FINANCIAL INFORMATION

Item 1.

Financial Statements

Condensed Consolidated Statement of Income

3

Three months ended March 31, 2007 and nine months ended September 30, 2006 and 2005

Condensed Consolidated Balance Sheet

4

As of September 30, 2006March 31, 2007 and December 31, 20052006

Condensed Consolidated Statement of Cash Flows

5

NineThree months ended September 30,March 31, 2007 and 2006 and 2005

Notes to Condensed Consolidated Financial Statements

6-186-15

Item 2.

Management's Discussion and Analysis of Financial

Condition and Results of Operations

19-2516-19

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

2620

Item 4.

Controls and Procedures

2620

PART II.  OTHER INFORMATION

Item 1.

Legal Proceedings

2620

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

2721

Item 6.

Exhibits

2721

Signature

2822

Index to Exhibits

2923

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PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF INCOME

(millions of dollars)

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EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEET

(millions of dollars)

The number of shares of common stock issued and outstanding at September 30, 2006 and

December 31, 2005 were 5,832,488,445 and 6,132,998,174, respectively.

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EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(millions of dollars)

-5-

EXXON MOBIL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.

Basis of Financial Statement Preparation

These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation's 20052006 Annual Report on Form 10-K.  In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein.  All such adjustments are of a normal recurring nature.  The Corporation's exploration and production activities are accounted for under the "successful efforts" method.  A reclassification on the first quarter 2006 income statement was made in the second quarter 2006 of $1.3 billion from "Other taxes and duties" to "Crude oil and product purchases" related to the prior period balance sheet to combine the amounts for "Benefit plan related balances" and "Common stock" per the adoptionreporting of FAS 123R has been made to conform to the current presentation.

2.

Accounting Change for Purchases/Sales Contracts

Effective January 1, 2006, the Corporation adopted the Emerging Issues Task Force (EITF) consensus on Issue No. 04-13, “Accounting for Purchases and Sales of Inventory with the Same Counterparty.”  The EITF concluded that purchases and sales of inventory with the same counterparty that are entered into in contemplation of one another should be combined and recorded as exchanges measured at the book value of the item sold.  In prior periods, the Corporation recorded certain crude oil, natural gas, petroleum product and chemical sales and purchases contemporaneously negotiated with the same counterparty as revenues and purchases.  As a result of the EITF consensus, the Corporation’s accounts “Sales and other operating revenue”, “Crude oil and product purchases” and "Other taxes and duties" on the income statement were reduced by associated amounts with no imp act on net income. All operating segments are affected by this change, with the largest impact in the Downstream.counterparty.

3.2.

Accounting Change for Share-based PaymentsUncertainty in Income Taxes

Effective January 1, 2006,2007, the Corporation adopted the Financial Accounting Standards Board's revisedBoard’s (FASB) Interpretation No. 48 (FIN 48), "Accounting for Uncertainty in Income Taxes".  FIN 48 is an interpretation of FASB Statement of Financial Accounting Standards No. 123 (FAS 123R)109, "Accounting for Income Taxes", “Share-based Payment.” FAS 123R requires compensation costs related to share-based payments to be recognizedand prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the income statement over the requisite service period. The amount of the compensation cost is to be measured based on the grant-date fair value of the instrument issued. FAS 123R is effective for awards granted or modified after the date of adoption and for awards granted prior tofinancial statements uncertain tax positions that date that have not vested. In 2003, the Corporation adoptedhas taken or expects to take in its income tax returns.  Upon the adoption of FIN 48, the Corporation recognized a policytransition gain of expensing all share-based payments that is consistent with$267 million in shareholders’ equity.  The gain reflected the provisionsrecognition of FAS 123R, and all prior years' outstanding stock option awards have vested. FAS 123R does not materially change the Corporation’s existing accounting practices or the amount of share-based compensati on recognized in earnings.several refund claims, partly offset by increased liability reserves.

The cumulative compensation expense associatedCorporation is subject to income taxation in many jurisdictions around the world.  The total amount of unrecognized income tax benefits in these jurisdictions at January 1, 2007, was $3.7 billion, almost all of which is classified as long term.  Resolution of the related tax positions through negotiations with share-based payments made in 2005, 2004 and 2003 has been recognizedthe relevant tax authorities or through litigation will take many years to complete.  Accordingly, it is difficult to predict the timing of resolution for individual tax positions.  However, the Corporation does not anticipate that the total amount of unrecognized tax benefits will significantly increase or decrease in the income statement usingnext 12 months.  Given the “nominal vesting period approach.” The full costlong time periods involved in resolving individual tax positions, the Corporation does not expect that the recognition of awards given to employees whounrecognized tax benefits will have retired before the end of the vesting period has been expensed. The use of a “non-substantive vesting period approach” basedmaterial impact on the retirement eligibility age is not significantly different fromCorporation’s effective income tax rate in any given year.

The following table summarizes the nominal vesting period approach. The non-substantive vesting period approach is applicabletax years that remain subject to grants made after the adoption of FAS 123R.examination by major tax jurisdiction:

The Corporation classifies interest on income tax related balances as interest expense or interest income and classifies tax related penalties as operating expense.  

At January 1, 2007, the Corporation had accrued interest payable of $0.5 billion related to income tax reserve balances.

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Incentive Program

The 2003 Incentive Program provides for grants of stock options, stock appreciation rights (SARs), restricted stock and other forms of award. Awards may be granted to eligible employees of the Corporation and those affiliates at least 50 percent owned. The maximum number of shares of stock that may be issued under the 2003 Incentive Program is 220 million. Awards that are forfeited or expire, or are settled in cash, do not count against this maximum limit. The 2003 Incentive Program does not have a specified term. New awards may be made until the available shares are depleted, unless the Board terminates the plan early. Outstanding awards are subject to certain forfeiture provisions contained in the program or award instrument.

As under earlier programs, options and SARs may be granted at prices not less than 100 percent of market value on the date of grant and have a maximum life of 10 years. Most of the options and SARs normally first become exercisable one year following the date of grant. All remaining stock options and SARs outstanding were granted prior to 2002.

Restricted stock awards have been granted in the fourth quarter and the restricted shares were issued in the following first quarter. These shares are issued to employees from treasury stock. The units that are settled in cash are recorded as liabilities and their changes in fair value are recognized over the vesting period. During the applicable restricted periods, the shares may not be sold or transferred and are subject to forfeiture. The majority of the awards have graded vesting periods, with 50 percent of the shares in each award vesting after three years and the remaining 50 percent vesting after seven years. A small number of awards granted to certain senior executives have vesting periods of five years for 50 percent of the award and of ten years or retirement, which ever occurs later, for the remaining 50 percent of the award.

The Corporation has purchased shares in the open market and through negotiated transactions to offset shares issued in conjunction with benefit plans and programs.  Purchases may be discontinued at any time without prior notice.

In 2002, the Corporation began issuing restricted stock as share-based compensation in lieu of stock options. Compensation expense for these awards is based on the price of the stock at the date of grant and has been recognized in income over the requisite service period, which is the same method of accounting as under FAS 123R.  Prior to 2002, the Corporation issued stock options as share-based compensation, and since these awards vested prior to the effective date of FAS 123R, they continue to be accounted for by the method prescribed in APB 25, "Accounting for Stock Issued to Employees."  Under this method, compensation expense for awards granted in the form of stock options is measured at the intrinsic value of the options (the difference between the market price of the stock and the exercise price of the options) on the date of grant. Since these two prices are the same on the date of grant, no compensation expense has been recognized in income for these awards.

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Restricted stock and restricted units

The following table summarizes information about restricted stock and restricted stock units, including those shares from former Mobil plans, for the nine months ended September 30, 2006.

As of September 30, 2006, there was $952 million of unrecognized compensation cost related to the nonvested restricted awards.  This cost is expected to be recognized over a weighted-average period of 4.3 years.  The compensation cost charged against income for the restricted stock and restricted units was $112 million and $80 million for the three months ended September 30, 2006, and 2005, respectively.  The income tax benefit recognized in income related to this compensation expense was $15 million and $14 million for the same periods, respectively.  The compensation cost charged against income for the restricted stock and restricted units was $407 million and $311 million for the nine months ended September 30, 2006, and 2005, respectively.  The income tax benefit recognized in income related to this compensation expense was $56 million in each of the respective periods.

Stock options

The following table summarizes information about stock options, including those shares from former Mobil plans, for the nine months ended September 30, 2006.

No compensation expense was recognized for stock options in the nine months ended September 30, 2006, and 2005, as all remaining outstanding stock options were granted prior to 2002 and are fully vested. No income tax benefit was recognized in income during the quarter related to stock options.  Cash received from stock option exercises for the nine months ended September 30, 2006, was $829 million.  The cash tax benefit realized for the options exercised in the nine months ended September 30, 2006, was $270 million.  The aggregate intrinsic value of stock options exercised in the nine months ended September 30, 2006, was $879 million and for the balance of outstanding stock options was $3,460 million.

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4.3.

Litigation and Other Contingencies

Litigation

A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits and tax disputes. Management has regular litigation and tax reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably p ossible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a materially adverse effect upon the Corporation’s operations or financial condition.

A number of lawsuits, including class actions, were brought in various courts against Exxon Mobil Corporation and certain of its subsidiaries relating to the accidental release of crude oil from the tanker Exxon Valdez in 1989. The vast majority ofAll the compensatory claims have been resolved and paid. All of the punitive damage claims were consolidated in the civil trial that began in 1994. The first judgment from the United States District Court for the District of Alaska in the amount of $5 billion was vacated by the United States Court of Appeals for the Ninth Circuit as being excessive under the Constitution. The second judgment in the amount of $4 billion was vacated by the Ninth Circuit panel without argument and sent back for the District Court to reconsider in light of the recent U.S. Supreme Court decision inCampbell v. State Farm.Farm. The most recent District Court judgment for punitive damages was for $4 .5$4.5 billion plus interest and was entered in JanuaryJanua ry 2004. ExxonMobil and the plaintiffs have appealed this decision to the Ninth Circuit. The Corporation has posted a $5.4 billion letter of credit. Oral arguments were held beforeExxonMobil and the plaintiffs appealed this decision to the Ninth Circuit, which ruled on January 27, 2006. Management believesDecember 22, 2006, that the likelihoodaward be reduced to $2.5 billion. On January 12, 2007, ExxonMobil petitioned the Ninth Circuit Court of the judgment being upheld is remote.Appeals for a rehearing en banc of its appeal. While it is reasonably possible that a liability for punitive damages may have been incurred from the Exxon Valdez grounding, it is not possible to predict the ultimate outcome or to reasonably estimate any such potential liability.

In December 2000, a jury in the 15th Judicial Circuit Court of Montgomery County, Alabama, returned a verdict against the Corporation in a dispute over royalties in the amount of $88 million in compensatory damages and $3.4 billion in punitive damages in the case ofExxon Corporation v. State of Alabama, et al.al. The verdict was upheld by the trial court in May 2001. In December 2002, the Alabama Supreme Court vacated the $3.5 billion jury verdict. The case was retried and in November 2003, a state district court jury in Montgomery, Alabama, returned a verdict against Exxon Mobil Corporation. The verdict included $63.5 million in compensatory damages and $11.8 billion in punitive damages. In March 2004, the district court judge reduced the amount of punitive damages to $3.5 billion. ExxonMobil believes the judgment is not justified by the evidence, that any punitive damage award is not justified by either the facts or the law, and that the amountamou nt of the award is grossly excessive and unconstitutional. ExxonMobil has appealed the decision to the Alabama Supreme Court. The Alabama Supreme Court heard oral arguments on February 6, 2007. Management believes that the likelihood of the judgment being upheld is remote. While it is reasonably possible that a liability may have been incurred by ExxonMobil from this dispute over royalties, it is not possible to predict the ultimate outcome or to reasonably estimate any such potential liability. In May 2004, the Corporation posted a $4.5 billion supersedeas bond as required by Alabama law to stay execution of the judgment pending appeal. The Corporation has pledged to the issuer of the bond collateral consisting of cash and short-term, high-quality securities with an aggregate value of approximately $4.6 billion. This collateral is reported as restricted cash and cash equivalents on the Consolidated Balance Sheet. Under the terms of the pledge agreement, the Corporation is entitled to receive the income generated from the cash and securities and to make investment decisions, but is restricted from using the pledged cash and securities for any other purpose until such time the bond is canceled.

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In 2001, a Louisiana state court jury awarded compensatory damages of $56 million and punitive damages of $1 billion to a landowner for damage caused by a third party that leased the property from the landowner. The third party provided pipe cleaning and storage services for the Corporation and other entities. The Louisiana Fourth Circuit Court of Appeals reduced the punitive damage award to $112 million in 2005. The Corporation appealed this decision to the Louisiana Supreme Court which, in March 2006, refused to hear the appeal. ExxonMobil has fully accrued and paid the compensatory and punitive damage awards. The Corporation has appealed the punitive damage award to the U.S. Supreme Court.

In Allapattah v. Exxon, a jury inCourt, which on February 26, 2007, vacated the United States District Court forjudgment and remanded the Southern District of Florida determined in 2001 that a class of Exxon dealers between March 1983 and August 1994 had been overcharged for gasoline. In June 2003,case to the EleventhLouisiana Fourth Circuit Court of Appeals affirmedfor reconsideration in light of the judgment and in March 2004, denied a petition for Rehearing En Banc. In October 2004, therecent U.S. Supreme Court granted review as to whether the classdecision in the District Court judgment should include members that individually do not satisfy the $50,000 minimum amount-in-controversy requirement in federal court. In light of the Supreme Court’s decision to grant review of only part of ExxonMobil’s appeal, the Corporation took an after-tax charge of $550 million in the third quarter of 2004 reflecting the estimated liability, after considering potential set-offs and defenses for the claims under review by the Supreme Court. In June 2005, the Supreme Court granted the District Court the right to hear the claims of all class members and the Corporation took an after-tax charge of $200 million. The District Court has given final approval of a settlement of $1,075 million, pre-tax. This obligation has been fully accrued and was paid in the second quarter 2006.Williams v. Phillip Morris USA.

Tax issues for 1989 to 1993 remain pending before the U.S. Tax Court. The ultimate resolution of these issues is not expected to have a materially adverse effect upon the Corporation’s operations or financial condition.

Other Contingencies

The Corporation and certain of its consolidated subsidiaries were contingently liable at

September 30, 2006, March 31, 2007, for $3,829$5,110 million, primarily relating to ExxonMobil's guarantees of obligations of equity companies for notes, loans and other liabilities.performance under contracts. Included in this amount were guarantees by consolidated affiliates of $4,354 million, representing ExxonMobil’s share of obligations of certain equity companies. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Additionally, the Corporation and its affiliates have numerous long-term sales and purchase commitments in their various business activities, all of which are expected to be fulfilled with no adverse consequences material to the Corporation’s operations or financial condition. The Corporation's outstanding unconditional purchase obligations at September 30, 2006,March 31, 2007, were similar to those at the prior year-end period. Unconditional purchase obligations as defined by accounting standards are those long-term commitments that are noncancelable or cancelable only under certain conditions, and that third parties have used to secure financing for the facilities that will provide the contracted goods or services.

The operations and earnings of the Corporation and its affiliates throughout the world have been, and may in the future be, affected from time to time in varying degree by political developments and laws and regulations, such as forced divestiture of assets; restrictions on production, imports and exports; price controls; tax increases and retroactive tax claims; expropriation of property; cancellation of contract rights and environmental regulations. Both the likelihood of such occurrences and their overall effect upon the Corporation vary greatly from country to country and are not predictable.

In accordance with a nationalization decree issued by Venezuela's President Chavez in February, the Venezuelan National Oil Company (PdVSA) on May 1, 2007 assumed the operatorship of the Cerro Negro heavy oil development, which had been operated by an ExxonMobil affiliate that holds a 41.67 percent ownership interest in the project. The decree also requires conversion of the Cerro Negro project into a "mixed enterprise" structure and an increase in PdVSA's ownership interest in the project. Discussions with Venezuelan authorities are continuing over proposed changes to the joint venture relating to the nationalization decree. The Corporation does not expect the resolution of these issues to have a material effect upon the Corporation’s operations or financial condition.

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-8-

5.4.

Nonowner Changes in Shareholders' Equity

6.5.

Earnings Per Share

-11--9-

7.6.

Annuity BenefitsPension and Other Postretirement Benefits

-12--10-

8.7.

Disclosures about Segments and Related Information