Chevron Results Top Expectations on Asset Sales, Refining Strength

By Chelsey Dulaney 

Chevron Corp. posted better-than-expected results in its December quarter, as asset sales and strength in its refining segment helped offset tumbling crude oil prices.

Chevron, the second-biggest U.S. oil company in market value behind Exxon Mobil Corp., has been working to increase its oil-and-gas production. But oil prices have plummeted in recent months amid an oversupply, just as the most ambitious drive among the world's major energy companies begins to show results. Oil prices have crashed more than 60% since last summer. U.S. crude prices dipped below $44 a barrel on Thursday, the lowest in almost six years, and closed at $44.53.

Chevron announced Friday that it would pare its capital budget by 13% this year to $35 billion to help offset the impact of low oil prices.

Still, Chevron's profits are better insulated than most oil producers because it also makes money from refining the fuel into gasoline and diesel. The lower-cost crude has helped its refinery businesses improve profit margins.

For the latest quarter, refining, marketing and chemical operations, or downstream, earnings surged to $1.52 billion from $390 million a year earlier.

Meanwhile, earnings from exploration and production, known as the upstream segment, fell to $2.67 billion from $4.85 billion a year earlier.

For the fourth quarter, Chevron said its global oil-equivalent production for the period 2.58 million barrels a day, unchanged from a year earlier.

Overall, Chevron reported earnings of $3.47 billion, or $1.85 a share, down from $4.93 billion, or $2.57 a share, a year earlier. Results included a net $570 million gain on asset sales.

Revenue fell 18% to $46.1 billion.

Analysts polled by Thomson Reuters had forecast earnings of $1.63 a share and revenue of $30.65 billion.

Write to Chelsey Dulaney at [e-mail]

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