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Chevron 1Q profit falls 64 pct as oil prices drop
2009-05-01
HOUSTON - Chevron Corp. said Friday first-quarter profit fell 64 percent as it, along with competitors, was stung by lower oil and natural gas prices. Chevron, the second-largest U.S. oil company, said its net income for the first three months of 2009 amounted to $1.84 billion, or 92 cents per share. That compared with $5.17 billion, or $2.48 per share, in the quarter a year ago. The most-recent result included gains of about $400 million, or 20 cents per share, for the sale of assets. Thomson Reuters says analysts it surveyed expected earnings of 81 cents per share. Those estimates typically exclude one-time items. San Ramon, Calif.-based Chevron says total revenue fell 45 percent to $36.1 billion from $65.9 billion a year ago. Chevron, like others in the industry, has faced severe market conditions amid the worst global recession in a generation. The biggest difference from a year ago is the price of oil, which spent most of 2008 at triple-digit levels and contributed to enormous profits before collapsing. A barrel of crude was trading Friday at around $50 on the New York Mercantile Exchange. Natural gas prices have fallen sharply too as consumers scale back energy consumption and inventories build. Chevron said income from its exploration and production operations tumbled 75 percent in the quarter to $1.27 billion, dragged down by lower prices. The company was particularly hard hit in the U.S., where earnings plummeted from $1.6 billion a year ago to $21 million in the first three months of 2009. The reason was simple: Chevron's average sales prices per barrel of crude oil and natural gas liquids fell nearly 60 percent from a year ago to $36. Comparable natural gas prices fell 45 percent. Company shares fell 24 cents to $65.86 in premarket trading.
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