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Chevron profits bulge on red-hot oil prices
AFP
NEW YORK
Petroleumworld.com 10 28 06
US energy group Chevron Corp. said Friday its third-quarter net profits bulged dramatically to five billion dollars, largely due to searing-hot crude oil prices.
The California firm's quarterly net profits for the three months ended September 30 surged 40 percent from the same period a year before, when Chevron booked profits of 3.6 billion dollars.
The company posted better-than-expected earnings per share of 2.29 dollars, against Wall Street forecasts for 2.03 dollars, up strongly from 1.64 dollars a year earlier.
Chevron jacked up its oil production as crude prices soared to record heights above 78 dollars in July and August, although they have since cooled to around 61 dollars a barrel.
Top executives said profits had also risen on higher price margins for refined products such as gasoline.
"Downstream profits increased to 1.4 billion dollars in the third quarter, driven by higher utilization of our US refineries and improved refined-product margins in most of our areas of operation," Chevron's chief executive Dave O'Reilly said in a statement.
But Chevron's revenues were little changed in the third quarter at 53 billion dollars, down 0.8 percent from the year before.
Stronger sales from increased production and higher prices were offset by the impact of an accounting rule change beginning in the second quarter of 2006, the company said.
Investors cheered Chevron's latest earnings, sending its shares up 47 cents to 67.97 dollars in early-morning deals.
Chevron joined a list of big energy groups posting gargantuan third-quarter profits.
The world's largest energy player, ExxonMobil Corp., announced record quarterly profits of 10.49 billion dollars on Thursday, after British energy giant BP posted net profits of 6.975 billion dollars on Tuesday.
Chevron said its net profits for the first nine months of the year climbed to 13.4 billion dollars, or 6.06 dollars per share, against 10.0 billion and 4.68 dollars per share for the same period of 2005.
Although the lion's share of Chevron's quarterly profits were derived from its upstream operations, mainly oil and natural gas production, its downstream profits, mainly refining and marketing, saw a much bigger percentage gain.
Chevron's global upstream profits rose five percent to 3.5 billion dollars, while downstream earnings improved by a vast 151 percent to 1.4 billion.
Profits boomed as the company pumped more oil.
Chevron's worldwide oil-equivalent production rose by 152,000 barrels per day to 2.7 million barrels per day from the third quarter of 2005.
The rich cash flows enabled Chevron to continue its ongoing share buyback program. It has repurchased 3.7 billion dollars' worth of its shares so far for the first nine months of the year and said it remains on track to complete a five-billion-dollar share buyback by year's end.
AFP 27 1411 GMT 10 06
Copyright ©2006 AFP. All Rights Reserved.
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