• News
  • Finance

Chevron First-Quarter Profit Declines on Prices and Bad Weather

May 2 (Bloomberg) -- Chevron Corp. reported a decline in first-quarter profit as crude prices dropped and bad weather disrupted some oil and natural gas production.

First-quarter net income was $4.51 billion, or $2.36 a share, compared with $6.18 billion, or $3.18, a year earlier, San Ramon, California-based Chevron said in a statement today. The per-share result was 16 cents less than the $2.52 average of 11 analysts’ estimates compiled by Bloomberg.

Chevron, the world’s third-largest oil producer by market value, is among international energy explorers caught in the middle of an intensifying row between the U.S. and its European allies on one side, and Russian President Vladimir Putin on the other. Putin put foreign oil companies on the spot on April 29 when he said they may be shut out of his country if their governments continue to ratchet up sanctions against Russian nationals and institutions.

Chevron and its partners are in the midst of a $5.4 billion expansion of a pipeline that carries oil across Russia’s Caucasus region from fields in neighboring Kazakhstan that account for 12 percent of the company’s global supplies.

Chevron warned investors last month that weather conditions had curtailed oil and gas production in key regions including Central Asia and North America. The company also cited negative impacts in the quarter from currency fluctuations and falling values for some assets.

Exploration Spending

Chairman and Chief Executive Officer John Watson is spending almost $40 billion this year to drill for new discoveries and transport oil, gas and fuels such as diesel to markets. In tandem with exploration forays that span the globe from Argentina to China, Watson is overseeing $10 billion in asset sales to narrow the company’s focus on its highest-profit projects.

Brent crude futures, the benchmark for more than half the world’s oil, declined by 4.2 percent to an average of $107.92 a barrel during the quarter, according to data compiled by Bloomberg. U.S. gas prices climbed 35 percent to average $4.712 per million British thermal units during that period.

The statement was released before the opening of regular trading in New York. Chevron shares fell 0.5 percent to $124.94 in New York yesterday.

Exxon Mobil Corp. is the world’s largest energy company by market value, followed by Royal Dutch Shell Plc.

User Response
0 UserComments