Chevron's Production Soared Along With Oil Prices in the First Quarter, But Its Profits Fell. What Happened With the Oil Stock?

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Dual headwinds impacted Chevron's quarter

Chevron reported astir $2.8 billion, oregon $1.41 per share, of adjusted net successful the archetypal quarter. That was down from $3 cardinal successful the 4th fourth and $3.8 cardinal successful the year-ago period, adjacent though Brent lipid (the planetary benchmark price) averaged $81 per tube successful the archetypal quarter, up from $64 successful the 4th fourth and $76 successful the year-ago period.

While Chevron's accumulation was up 15% from the year-ago play owed to the acquisition of Hess and maturation successful the Gulf of Mexico (also known arsenic the Gulf of America successful the U.S.) and Permian Basin, it was down from the implicit 4 cardinal BOE/d it produced successful the 4th quarter. That was owed to little accumulation successful the Middle East (Israel and the partitioned portion betwixt Saudia Arabia and Kuwait) and immoderate downtime astatine its affiliate successful Kazakhstan. That little accumulation impacted Chevron's quality to afloat capitalize connected higher lipid prices.

The different contented impacting Chevron's fiscal results was $2.9 cardinal successful unfavorable timing effects. These effects included timing mismatches successful recognizing net connected fiscal derivatives earlier the carnal transportation of the associated lipid and state production. Without these unfavorable impacts, its net would person improved successful the period.

Strength beneath the surface

While proviso disruptions and timing mismatches impacted the quarter, Chevron's underlying operations performed well. It produced implicit 2 cardinal BOE/d successful the U.S. for the 3rd consecutive quarter, driven by maturation successful the Gulf and Permian. Meanwhile, the company's U.S. refining assets operated astatine grounds lipid throughput levels successful March, portion averaging implicit 1 cardinal barrels per time during the quarter, marking its 5th consecutive 4th implicit the milestone. The institution besides continues to execute its cost-savings strategy and integrate Hess into its operations.