Chevron posts highest profit in 8 years on surging oil, gas prices

[HOUSTON] Chevron Corp on Friday posted its highest quarterly profit in eight years on surging oil and gas prices, higher output and a recovery in motor fuel demand that boosted refining margins.

The strong results came a day after US lawmakers grilled top executives of major oil companies over the industry's past dismissals of climate warming and for funding groups that oppose a shift from fossil fuels.

Chevron's earnings reflect, in part, gains from higher demand after the industry's deep production cuts last year during the pandemic and production increases.

The company posted net income of US$6.11 billion, compared with a loss of US$207 million a year ago, on sales of oil that fetched nearly twice as much as a year ago and US-produced gas that sold for three times as much.

Cash flow from operations, a closely watched measure, was US$8.5 billion in the quarter, "the best ever reported by the company," chief executive Michael Wirth said in a statement.

Overall production rose on the firm's acquisition of Noble Energy and more production from Opec partners, Wirth said. It would have been stronger if not for maintenance shut-ins at Kazakhstan's giant Tengiz field.

Strong international results pushed Chevron's operating profit from oil and gas production to US$5.1 billion, from just US$235 million a year ago. Profits in US refining and chemicals jumped more than six times from a year-ago on higher demand for chemicals and motor fuels.

Results are "boding well for higher shareholder returns,"said Palissy Advisors analyst Anish Kapadia. High demand for liquefied natural gas and strong US refining margins delivered the best results in over four years, he said.

Chevron, the number 2 US oil producer, plans to increase oil and gas output through 2025 by up to 3 per cent annually.

REUTERS