Murphy Oil Announces Preliminary First Quarter 2012 Earnings

Murphy Oil Corporation (NYSE: MUR) announced today that net income in
the first quarter of 2012 was $290.1 million ($1.49 per diluted share),
compared to net income of $268.9 ?million ($1.38 per diluted share) in
the first quarter of 2011. The 2011 first quarter included income from
discontinued operations of $30.5 ?million ($0.16 per diluted share)
related to two U.S. refineries and associated marketing assets that were
sold at the end of the third quarter of 2011. Income from continuing
operations in the 2011 first quarter was $238.4 ?million ($1.22 per
diluted share). Income from continuing operations and associated diluted
income per share were 22% higher in the 2012 quarter compared to the
same quarter of 2011. The improved income from continuing operations in
2012 compared to 2011 was primarily due to higher earnings from the
Company′s exploration and production operations.

Exploration and Production (E&P)

Income contribution from E&P operations was $321.6 ?million in the first
quarter of 2012, up from $260.4 ?million in the same quarter of 2011. A
higher average realized sales price for crude oil and lower exploration
expenses were the primary drivers for the earnings improvement in the
2012 quarter. The 2012 quarter was unfavorably impacted by lower crude
oil sales volumes and significantly lower North American natural gas
sales prices.

The Company′s worldwide crude oil, condensate and natural gas liquid
sales prices averaged $97.78 per barrel for the 2012 first quarter
compared to the 2011 first quarter average of $86.73 per barrel. Total
crude oil, condensate and gas liquids production of 107,490 barrels per
day in the first quarter of 2012 was below the 113,313 barrels per day
produced in the 2011 quarter. The decline in oil production in 2012 was
attributable to lower volumes produced at the Kikeh field, offshore
Sabah, Malaysia, the Azurite field, offshore Republic of the Congo, and
at Syncrude in Western Canada. Oil production in the U.S. was higher in
the 2012 quarter and was attributable to ongoing development activities
in the Eagle Ford Shale area of South Texas. Total sales volumes
of ?crude oil, condensate and natural gas liquids averaged
108,562 ?barrels per day in the first quarter 2012 compared to 112,804
barrels per day in the 2011 quarter. North American natural gas sales
prices averaged $2.56 per thousand cubic feet (MCF) in the 2012 first
quarter compared to $4.35 per MCF in the same quarter of 2011. Natural
gas produced at fields offshore Sarawak Malaysia was sold at an average
of $7.80 per MCF in the 2012 quarter, up from $5.64 ?per MCF in the 2011
first quarter. Natural gas sales volume of over 525 million cubic feet
per day in the first three months of 2012 was a quarterly record for the
Company, and was up from 413 ?million cubic feet per day sold in the 2011
period. The increase in natural gas sales volume in 2012 was primarily
due to a full quarter of natural gas production at the Tupper West area
in Northeast British Columbia. Tupper West was on production for only a
portion of the 2011 first quarter after coming online in February of
last year.

Production expenses increased $12.3 ?million in 2012 compared to 2011
based on higher hydrocarbon volumes sold. Depreciation expense increased
by $73.6 million in 2012 due to both higher volumes sold and a higher
average capital amortization rate for these additional volumes.

Exploration expense in the 2012 period was $53.0 million compared to
$96.3 million in 2011. Dry hole expense was lower by $35.2 million in
the 2012 period primarily due to the first quarter 2011 including
unsuccessful drilling costs offshore Suriname. Geological and
geophysical expense was $9.7 million lower in 2012 compared to 2011 due
to the prior year′s quarter including seismic acquisition costs in the
U.S. Mississippi ?Canyon deepwater area in the Gulf of Mexico and the
Eagle Ford Shale area. These lower costs in the U.S. in 2012 were
partially offset by higher seismic costs in Australia and other foreign
prospective areas.

Refining and Marketing (R&M)

Murphy′s R&M continuing operations incurred a loss of $4.2 million in
the 2012 first quarter compared to income of $0.3 million in the 2011
quarter.

U.S. downstream operations generated a loss of $7.2 million in the 2012
quarter, compared to income of $9.0 ?million in 2011. Margins for U.S.
retail marketing operations were depressed in the 2012 quarter compared
to a year earlier due to significantly higher wholesale gasoline
purchase prices during the latest quarter. U.S. retail margins in 2012
were $0.02 ?per gallon below 2011 levels. Total margin on merchandise
sales in 2012 was about flat with 2011. Average U.S. retail fuel sales
volumes in 2012 on a per-store basis were lower by about 6% compared to
2011. Results for ethanol production operations in 2012 were less than
in 2011 due to weaker crush spreads in the latest quarter caused by
ethanol prices not keeping pace with the increase in corn costs.

Refining and marketing operations in the United ?Kingdom produced a
profit of $3.0 ?million in the first quarter 2012 compared to a loss of
$8.7 million in the same quarter of 2011. The improvement in operating
results for U.K. R&M operations in 2012 was primarily due to better
refining margins and higher refinery throughput volumes in the most
recent quarter at the Milford Haven, Wales, refinery. The Company has
previously announced its intent to sell the U.K. downstream operations
and those efforts continue to progress.

Corporate

Corporate functions had net costs of $27.3 million in the 2012 first
quarter compared to net costs of $22.2 million in the 2011 first
quarter. The larger net cost in 2012 compared to 2011 was primarily due
to higher administrative costs and lower interest income in the current
quarter. The after-tax costs for transactions denominated in foreign
currencies was $1.5 million in the 2012 quarter compared to after-tax
costs of $1.1 million in the 2011 quarter.

Discontinued Operations

Murphy′s U.S. downstream subsidiary sold the Meraux, Louisiana and
Superior, Wisconsin refineries and certain associated marketing assets
at the end of the third quarter 2011. All results of operations for
these assets have been accounted for as discontinued operations in the
consolidated financial statements. Income from discontinued operations
was $30.5 ?million in the first quarter of 2011, but the 2012 quarter
included no discontinued operating results. The 2011 income was
attributable to U.S. refining margins that averaged $2.93 per barrel of
throughput by the refineries.

David Wood, Murphy′s President and Chief Executive Officer, commented,
'The divergence in North American oil and natural gas prices during the
first quarter was quite extreme. Although oil prices remain strong in
the early days of the second quarter, natural gas prices in North
America have further softened during the shoulder months in the spring.
Our Company has made a good start with exploratory drilling in early
2012. Two natural gas discoveries in Block ?H, offshore Malaysia, have
potential to be combined with nearby discoveries for a future floating
LNG project. Also, a discovery has been made offshore Brunei in Block
CA-1. Drilling activity in the Central Dohuk block in Kurdistan is
progressing nicely. We continue our development drilling program in the
oil window of the Eagle Ford Shale, where we are currently running ten
rigs. The rising price of wholesale refined products, associated with
the crude oil price rise, led to a squeeze on U.S. retail marketing
margins during the first quarter. The easing of wholesale prices early
in the second quarter has given margins a boost.

'We currently anticipate total worldwide production volumes of
185,000 ?barrels of oil equivalent per day in the second quarter of 2012.
Sales volumes of oil and natural gas are projected to average
184,000 ?barrels of oil equivalent per day in the second quarter. We
anticipate a full-year 2012 production rate of about 193,000 ?barrel
equivalents per day. This 2012 production estimate is below prior
guidance due to reduced dry gas volumes at the Tupper area, revised
Syncrude performance, and workover delays at Kikeh. At the present time,
we expect net income in the second quarter 2012 to range between $1.35
and $1.60 ?per diluted share. The second quarter estimate includes
projected exploration expense ranging between $50 ?million and
$110 ?million during the quarter, and earnings from our downstream
businesses are projected at approximately $67 ?million. Results could
vary based on commodity prices, drilling results, timing of crude oil
and natural gas sales, refining and marketing margins, and foreign
exchange movements.?

The public is invited to access the Company′s conference call to discuss
first quarter 2012 results on Thursday, May 3^rd , at 12:00
p.m. CDT either via the Internet through the Investor ?Relations section
of Murphy′s Web site at http://www.murphyoilcorp.com/ir
or via the telephone by dialing1-877-874-1569. The telephone
reservation number for the call is 1011443. Replays of the call will be
available through the same address on the Murphy Web site, and a
recording of the call will be available through May 7^th by
dialing 1-888-203-1112 and referencing reservation number 1011443. Audio
downloads will be available on the Murphy Web site through June 1 and
via Thomson StreetEvents for their service subscribers.

In addition, the Company will be webcasting the 2012 Murphy Oil Analyst
Day to be held on May 8, 2012 starting at 2:00 p.m. CDT. To access the
webcast, please go to the Murphy Web site at www.murphyoilcorp.com
and select the link to the webcast.

This press release contains forward-looking statements as defined in
the Private Securities Litigation Reform Act of 1995.These
statements, which express management′s current views concerning future
events or results, are subject to inherent risks and uncertainties.Factors
that could cause actual results to differ materially from those
expressed or implied in our forward-looking statements include, but are
not limited to, the volatility and level of crude oil and natural gas
prices, the level and success rate of our exploration programs, our
ability to maintain production rates and replace reserves, customer
demand for our products, political and regulatory instability, and
uncontrollable natural hazards.For further discussion of risk
factors, see Murphy′s 2011 Annual Report on Form 10-K on file with the
U.S. Securities and Exchange Commission.Murphy undertakes no
duty to publicly update or revise any forward-looking statements.

Murphy Oil Corporation

Barry Jeffery, 870-864-6501