Chevron’s profit falls 37% in Q3, but exceeds estimates

According to media reports, Chevron Corp. announced its financial results for the third quarter. The company’s Q3 profit fell by 37% from the last year due to lower oil prices and weak refining margins. However, cost cuts helped reduce the impact of lower crude prices.

Net income of the company decreased to $1.28 billion or $0.68 per share from $2.04 billion or $1.09 per share in Q3 of 2015. However, analysts’ average expectations excluding special items had called for a profit of $0.37 per share for the third quarter.

Chevron’s total revenues and other income dropped 12% to $30.14 billion in the third quarter of 2016, when compared to $34.32 billion in the same period of the previous year, beating analysts’ average forecasts calling for $29.05 billion.

Earnings for the upstream segment increased to $454 million from $59 million a year earlier while downstream segment earnings decreased 52% to $1.07 billion. Earnings at Chevron’s upstream arm, which produces oil and natural gas, jumped more than sevenfold as costs in the United States dropped and tax expenses fell. However, Chevron’s refining arm saw profit drop more than 50 percent as margins dropped both within and outside the United States.

The drop in the downstream segment, meanwhile, was attributed to lower earnings from Chevron Phillips Chemical Company and refined product sales’ lower margins.

The company’s sales and other operating revenues fell by 11% to $29.16 billion in the third quarter when compared to $32.77 billion in the same quarter of the last year.