Chevron Corp. (CVX) fell after posting the lowest second-quarter oil and natural gas output in six years as spending on new projects surged.
Chevron declined 1 percent to $127.90 at the close in New York. The production drop overshadowed the biggest quarterly profit increase in more than a year for the San Ramon, California-based company. Net income rose to $5.67 billion, or $2.98 a share, from $5.37 billion, or $2.77, a year earlier, Chevron said in a statement today. Per-share profit exceeded the average of 13 analysts’ estimates compiled by Bloomberg.
Investors punished the world’s third-largest energy company by market value after it reported output decreased 1.4 percent to the equivalent of 2.545 million barrels of oil a day during the April-to-June period, the weakest performance since 2008. Capital spending on new floating production platforms, wells, gas-export plants and other projects jumped 7.8 percent to $10.2 billion for the quarter.
Chevron had been expected to report output of 2.595 million barrels a day, based on the average of six analysts’ estimates compiled by Bloomberg. The company cited repair work at its sprawling Tengizchevroil production facility in Kazakhstan as well as contracts that reduce its share of output from some wells when crude prices rise.
Sales rose 0.5 percent to $55.6 billion during the quarter. Profit was bolstered by the $1.3 billion sale of stakes in an oil field in the African nation of Chad and the pipeline that connects it to the coast of Cameroon, according to the statement.
Chevron has 17 buy, two sell, and 12 hold recommendations from analysts, according to data compiled by Bloomberg.
Brent crude futures, a global benchmark, rose 6 percent from a year earlier to average $109.76 a barrel in the second quarter. Natural gas futures prices in New York rose 14 percent to average $4.579 per million British thermal units.
(An earlier version of this story was corrected to fix misspelling of Kazakhstan and Tengizchevroil.)
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