Driven by record-high gasoline prices and the sale of oil and natural gas fields in Canada, profit at ChevronTexaco Corp. more than doubled during the second quarter, the San Ramon, Calif.-based refiner said Friday.
ChevronTexaco's financial performance echoed the strong quarterly results reported by other major U.S. oil refiners this week as increased demand for gasoline and uncertain supplies have kept pump prices high nationwide.
"Oil companies are printing money. I don't see anything that will slow this down anytime soon," said Fadel Gheit of Oppenheimer & Co. in New York. "There was improvement in every category of Chevron's business. It was really strong -- the best in class."
ChevronTexaco, the nation's second-largest oil company, reported net income of $4.1 billion, or $3.88 a share, in the three months ended June 30, up from $1.6 billion, or $1.50, in the second quarter of 2003. The results handily beat the consensus Wall Street forecast of $3.09 a share. Sales rose 31% to $38.3 billion.
Investors pushed ChevronTexaco's stock up 17 cents to a three-year high of $95.65 a share on the New York Stock Exchange.
"We're proud of the progress we've made," Chief Executive Dave O'Reilly said.
The quarter continued the profitable results ChevronTexaco posted in the first three months of the year as oil prices began rising to record highs, pushing gasoline prices above $2 a gallon in many areas.
During the second quarter, pump prices averaged $1.92 nationwide, a 26% increase from the same period in 2003. In California, a major market for ChevronTexaco, prices peaked at $2.33 a gallon on May 31.
Although gas prices have dipped in recent weeks, oil continues to hit new highs. On Friday, the price of oil on the New York Mercantile Exchange rose $1.05 a barrel to $43.80.
"Earnings are expected to be exceptionally strong, near term," as oil and gas prices remain high, A.G. Edwards & Sons Inc. oil analyst Bruce Lanni wrote.
Indeed, the Iraq war is helping to fuel the continued high prices for oil as possible disruptions in supply because of political uncertainly drive prices up, analysts said.
Consumer advocates and critics have claimed the oil giants are using the Iraq war and supply concerns as "scapegoats" for high prices that are actually due to market manipulation.
