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Chevron reports profit up 4.2%

Higher prices for oil in the first quarter more than offset a decline for natural gas at the California oil company.

April 28, 2012|By Ronald D. White, Los Angeles Times

Chevron Corp. said first-quarter profit rose 4.2% as rising oil prices offset falling natural gas prices.

Net income for the first three months of the year increased to $6.47 billion, or $3.27 a share, from $6.21 billion, or $3.09,a year earlier, the San Ramon, Calif., company reported Friday.

Revenue for the world's third-largest publicly traded oil company rose to $60.71 billion, compared with $60.34 billion in the first quarter last year.

The company's financial performance was hurt by a sharp year-to-year decline in natural gas prices, but that drop was more than offset by sharply higher oil prices. Chevron's average sales price for a barrel of crude oil and natural gas liquids was $102 in the first quarter, compared with $89 in the year-earlier quarter.

"In the first quarter, we continued to post strong earnings and healthy cash flows," Chevron Chief Executive John Watson said. "This has enabled us to both reward our shareholders with a substantial dividend increase, our third in just over a year, and to reinvest in profitable growth projects to help meet rising global energy demand."

Fadel Gheit, senior energy analyst for Oppenheimer & Co., said Chevron had a strong quarter despite production declines, achieving the oil industry's highest profit per barrel of oil.

Chevron increased capital and exploratory spending to $6.42 billion from $5.05 billion a year earlier.

Chevron oil and gas production declined to 2.63 million barrels a day in the first quarter from 2.76 million barrels.

Chevron's stock rose 20 cents to $106.42.

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