Chevron Corp. reported a 0.58% increase in quarterly profit to $6.6 billion in the first quarter, boosted by higher refining margins and higher energy prices. Despite this, the company's net income edged up 5% compared with the same period last year and was more than double its quarterly average over the past decade.
"Despite the low oil prices, Chevron's earnings beat analysts’ expectations by 4.4%. Our standout business was oil refining, where higher margins helped income surge more than five-fold to $1.8 billion," said John Watson, CEO of Chevron Corp.
In addition to strong performance from its refining business, Chevron also saw a decrease of 25% on a big year-over-year decline in prices due to Brent crude trading at an average of $82 per barrel down 16% from a year earlier and a drop of 7% from the fourth-quarter.
The company ended the quarter with $15.8bn in cash, which is down by12%, but still well above what it needs for operations at around $10 billion excess funds.The decrease was partially offset by a production growth of 4% in Permian Basin -the largest shale basin- located within United States borders.
"We have been strategically increasing production efforts within U.S while decreasing it elsewhere", stated Watson when discussing strategies that led to their better-than-expected earnings this quarter.
Meanwhile other major oil companies such as ExxonMobil also reported record profits despite falling gas prices during this time period; earning approximately $11 .6Billion (excluding special items), however they are facing decreases as well being down nearly38 %from third-quarter last year's high point ($18 .7 Billion).
ExxonMobil shares gained about1 %in premarket trading based on these recent reports while Chevron (CVX) shares remained relatively unchanged. ExxonMobil also beat market expectations in Q1 with a profit increase, which stems from strong production growth driven by new crude oil volumes and fuels being generated via startup of offshore developments and refining facilities.
Next week, Shell and BP are set to report their latest results as the industry continues adapting to the current market demands while maintaining profitability when possible.