Chevron Sales Jump as Crude Oil Prices Rise

Chevron's (CVX Quote) earnings and revenue surged in the first quarter, but profits from refining operations slumped as the price of gasoline failed to keep pace with the giant advance in crude oil in the past year.

The San Ramon, Calif., oil and gas provider reported earnings of $5.17 billion, or $2.48 a share, for the first quarter, up from $4.72 billion and $2.18 a share in the same period a year earlier. Earnings in the 2007 quarter included a $700 million gain on downstream asset sales in Europe. Analysts were looking for $2.41 this year.

Sales and other operating revenue for the quarter jumped to $64.66 billion from $46.30 billion the previous year. Shares of Chevron were up 1.1% at $96.02 in the premarket.

"Upstream earnings benefited from a significant increase in the price of crude oil from a year ago," said Chairman and CEO Dave O'Reilly, in a press release Friday. "However, market conditions prevented our downstream business from fully recovering these higher costs through the price of gasoline and other refined products. Downstream results in the United States were essentially break-even in this year's first quarter."

Worldwide oil-equivalent production was 2.60 million barrels a day in the quarter, down 44,000 barrels from the corresponding period last year. Excluding the impact of higher prices on cost-recovery and variable-royalty volumes under provisions of certain production contracts outside the U.S., output increased slightly.

U.S. upstream income of $1.6 billion was double the year earlier, mainly because of higher prices for crude. Prices for natural gas also increased. International upstream earnings of $3.5 billion rose by $1.4 billion.