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Chevron Corp (CVX) on October 30,2020 reported earnings of $201 million or $0.11 per share in third quarter 2020 compared to profit of $2.9 billion or $1.55 per share in third quarter 2019.
The Wall Street analysts proved to be wrong after the positive results shown by Chevron as oil prices recovered from spring lows and spending cuts benefited operating results.
The U.S. oil producer and its partners have reduced financial plan this year due to low demand and low crude oil prices due to rise of covid-19 at the beginning of the year.
The company reported third quarter net loss of $207 million, compared with a profit of $2.6 billion last year.
“Third quarter results were down from a year ago, primarily due to lower commodity prices and margins resulting from the impact of COVID-19,” said Michael K. Wirth, Chevron’s chairman of the board and chief executive officer. “The world’s economy continues to operate below pre-pandemic levels, impacting demand for our products which are closely linked to economic activity.”
“We remain focused on what we can control – safe operations, capital discipline and cost management,” Wirth continued. “Compared to last year’s third quarter, organic capital expenditures and operating expenses were down 48 percent and 12 percent, respectively.”
Worldwide net oil-equivalent production was 2.83 million barrels per day in third quarter 2020, a decrease of 7 percent from a year ago. The decrease was largely a result of curtailed production in response to low commodity prices and asset sales, partially offset by net production increases at a number of properties.
U.S. upstream operations earned $116 million in third quarter 2020, compared with $727 million a year earlier. The decrease was primarily due to lower crude oil realizations.
The company’s average sales price per barrel of crude oil and natural gas liquids was $31 in third quarter 2020, down from $47 a year earlier. The average sales price of natural gas was $0.89 per thousand cubic feet in third quarter 2020, down from $0.95 in last year’s third quarter.
U.S. downstream operations earned $141 million in third quarter 2020, compared with $389 million a year earlier. The decrease was mainly due to lower sales volumes and lower margins on refined product sales, partially offset by lower operating expenses.
Refinery crude oil input in third quarter 2020 decreased 17 percent to 820,000 barrels per day from the year-ago period, as the company cut refinery runs in response to the weak refining margin environment.
Refined product sales of 1.00 million barrels per day were down 22 percent from third quarter 2019, mainly due to lower jet fuel, gasoline and diesel demand associated with the COVID-19 pandemic.