WRAPUP 3-Devon, XTO profits down but exceed Street view

* Devon, XTO Q3 profits surpass Street view

* XTO output up 23 pct, Devon production up 6 pct

* Devon shares up 1.9 pct, XTO shares up 1.3 pct

* Devon sees recovery in North American natural gas

* Murphy Oil profit falls 68 pct (Adds Murphy Oil, updates share movement)

By Anna Driver

HOUSTON, Nov 4 (Reuters) - Devon Energy Corp (DVN.N) and XTO Energy Inc (XTO.N) reported lower quarterly earnings on Wednesday as crude oil and natural gas prices fell from a year ago, but higher output and cost-cutting helped the U.S. independents top Wall Street expectations.

The global economic slowdown has reduced demand for natural gas and crude oil. As a result, inventories swelled in the third quarter and prices tumbled, cutting into profits at energy companies.

Murphy Oil Corp (MUR.N) said its quarterly profit fell 68 percent, hit by lower crude prices and as weak fuel demand in the global economic slowdown hurt its refining business.