Stock Market Watch

Chevron’s Q4 Profit Falls (CVX)

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ChevronChevron Corporation (NYSE: CVX), on Friday, announced its fourth-quarter financial results, posting lower quarterly earnings which fell short of Street estimates. Chevron’s fourth-quarter earnings were hurt by rising spending on oil and gas projects and losses at its U.S. refinery business, which offset higher crude oil prices.

Chevron’s oil and gas production dropped to 2.64 million barrels per day in the fourth quarter of 2011 from 2.79 million barrels per day a year before. Over the same period, average benchmark oil prices climbed nearly 25%.


Chevron said that the main factors behind the drop in output were the effect of higher prices on production sharing contracts, lower-than-expected performance at large new offshore projects in the Gulf of Mexico and Angola, and a third-party pipeline rupture and lower demand in Thailand.

Earlier this month, Chevron had warned that its refinery business would just about break even in the fourth quarter, however, U.S. losses pulled the entire refinery division into red in the fourth quarter.

For the fourth quarter of 2011, Chevron reported a profit of $5.1 billion, or $2.58 per share, compared with $5.3 billion, or $2.64 per share reported for the same period in the previous year. The company’s fourth-quarter profit fell short of analysts’ estimate of $2.84 per share.

Chevron’s spending on U.S. oil and gas projects nearly doubled in the fourth quarter of 2011 to $2 billion.

John Watson, Chairman and CEO of Chevron, said that the company had an outstanding year financially with record earnings and cash flow and this reflects the company’s exceptionally strong upstream portfolio as well as higher 2011 crude prices. Watson said that full-year earnings also benefited from improved downstream sales margin. He noted that in the fourth quarter, the company took another important step forward in its efforts to commercialize its significant natural gas resources with the start of construction at the Wheatsone liquefied natural gas project in Australia.

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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