CALIFORNIA: Second-quarter profit jumps 24 percent for energy company

Chevron Corp.'s profit soared to new heights in the second quarter, capping another round of astounding oil industry earnings that have piled up as high gasoline prices squeeze household budgets.

The San Ramon-based company said Friday that it made $5.4 billion, or $2.52 per share, during the three months ended June 30. That represented a 24 percent increase from net income of $4.35 billion, or $1.97 per share, a year earlier.

The performance by the nation's second largest oil company outstripped the second-quarter showings of four other industry leaders that released their results earlier this week.

Exxon Mobil and ConocoPhillips each reported a lower profit, while BP posted a modest earnings increase. Royal Dutch Shell reported an 18 percent earnings increase that was largely propelled by asset sales.

Combined, the five oil companies earned $32 billion during the second quarter. That represented a 7 percent decrease from the same time last year, but this year's results were dragged down by a $4.5 billion charge absorbed by ConocoPhillips to account for a dispute over its oil holdings in Venezuela. For Chevron, the latest profit represents the most money that the company has made in any three-month period during its 128-year history, smashing its previous record of $5.02 billion set in last year's third quarter.

What's more, Chevron is on pace to register a record annual profit for the fourth consecutive year. Chevron has already earned $10.1 billion through the first six months of this year, up 21 percent from last year's record.

Exxon Mobil, which is nearly two times larger than Chevron, remains on track to surpass its 2006 profit of $39.5 billion — the highest ever reported by a U.S. company.

But there are indications the industry might not be quite as prosperous in the second half of the year, with retail gasoline prices dropping from their recent highs as more refineries boost production after a wave of outages earlier this year.

Like its industry peers, Chevron benefited from a confluence of trouble that has plagued refineries this year. About one-third of the nation's 150 refineries have been out of commission at some point this year, an unusually large number that has strained the industry's ability to produce enough gasoline to keep up with the nation's seemingly insatiable demand.

The imbalance helped push gasoline prices well beyond $3 per gallon through most of the country during the spring, prompting some industry critics to suggest the refinery problems were part of a conspiracy to gouge motorists.

Industry executives and analysts say there is nothing sinister about what happened. They attribute the refinery disruptions to unforeseen circumstances and the need to catch up on repairs and upgrades.

Via: Chron

Blogalaxia Tags: