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Chevron Posts Dull Q1 Numbers, Upstream Earnings Fall

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Chevron’s first-quarter Upstream earnings

Chevron (CVX) posted its first-quarter earnings results on April 26. In the quarter, the company surpassed Wall Street analysts’ consensus earnings estimate.

For more information, read Chevron’s Q1 Earnings Fell, Beat the Estimate. Now let’s look at the company’s segmental earnings in more detail.

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Chevron’s earnings fell YoY (year-over-year) in the first quarter. Chevron’s Upstream segment’s adjusted earnings fell from $3.4 billion in the first quarter of 2018 to $3.3 billion in the first quarter of 2019 due to lower oil prices partly offset by higher hydrocarbon production.

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In the United States, Chevron’s average crude oil realizations fell from $61 per barrel in the first quarter of 2018 to $56 per barrel in the first quarter of 2019. Chevron’s total Upstream production increased 6.5% YoY to 3.04 million barrels of oil equivalent per day in the first quarter of 2019. The growth in its production was the result of higher volumes in the Permian and Wheatstone regions. This production ramp-up is expected to continue in the coming quarters.

Chevron’s peers’ upstream performances

Chevron’s peer Total’s (TOT) adjusted Energy and Production operating earnings fell 5% over the first quarter of 2018 to $1.7 billion in the first quarter of 2019. Similarly, ExxonMobil’s (XOM) Upstream earnings fell from $3.5 billion in the first quarter of 2018 to $2.9 billion in the first quarter of 2019.

Downstream earnings fell

Chevron’s adjusted Downstream earnings fell 69% YoY to $0.2 billion in the first quarter of 2019 mainly due to its lower margins domestically and internationally. Chevron’s total throughput fell 6.8% YoY in the first quarter. In the United States, its throughput fell 7.4% YoY due to the impact of weather conditions on its El Segundo and Richmond refineries. Its international throughputs fell 6.0% YoY due to the sale of its Cape Town refinery.

Chevron’s overall adjusted earnings fell from $3.6 billion in the first quarter of 2018 to $2.8 billion in the first quarter of 2019. Its lower Upstream and Downstream earnings affected its overall earnings.

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