Chevron posts losses amid low crude prices

OREANDA-NEWS. May 04, 2016. Chevron posted a \\$725mn loss in the first quarter, including a \\$1.46bn upstream loss amid a 35pc plunge in crude prices and lower refining margins.

The integrated's downstream business posted a fall in profit, to \\$735mn from \\$1.42bn a year earlier. Chevron had posted a net profit \\$2.5bn a year earlier.

"Our downstream operations continued to perform well, although overall industry conditions and margins this quarter were weaker than a year ago," chief executive John Watson said in a statement.

US upstream losses nearly doubled to \\$850mn compared to \\$460mn a year earlier.

It earned an average price of \\$26/bl on its crude and natural gas liquids (NGL) in first quarter,

down from \\$43/bl a year ago. Natural gas sales averaged \\$1.32/Mcf compared with \\$2.27/Mcf a year earlier.

The non-US upstream business posted a loss of \\$609mn compared with a profit \\$2.02bn. It earned an average price of \\$29/bl on its crude oil and natural gas liquids (NGLs) in first quarter, down from \\$46 a year earlier. Natural gas price was \\$3.91/Mcf versus \\$5.01/Mcf a year earlier.

Worldwide output fell marginally to 2.67mn b/d of oil equivalent (boe/d) compared with 2.68mn boe/d as increases in project ramp-ups in the US, Nigeria and were offset by the continued shut-in

at an oilfield in the Partitioned Zone, shared between Saudi Arabia and Kuwait,

and normal field declines. Of that, US output rose to 701,000 boe/d, up 2,000 boe/d from a year earlier. Output increases from project ramp-ups in the Gulf of Mexico, the Marcellus shale basin in Pennsylvania and the Permian in Texas were mostly offset by maintenance-related downtime in the Gulf of Mexico, normal field declines and the effect of asset sales.

The major's cash flow from operations in the first quarter fell to \\$1.1bn from \\$2.3bn a year earlier, while capital expenditure (capex) fell to \\$6.5bn compared with \\$8.6bn a year earlier. Of that, spending in the upstream was 92pc of the total in the first quarter. Upstream spending in the US fell to \\$1.28bn from \\$2.32bn a year earlier, while international upstream capex fell to \\$4.69bn from \\$5.84bn a year earlier.