FX.co ★ Chevron To Optimize Portfolio, Reduce Operating Costs; Q3 Net Oil-equivalent Production Up 7%

Chevron Corporation (CVX) has announced strategic initiatives aimed at optimizing its portfolio and reducing operating expenses. The company plans to complete asset sales in Canada, Congo, and Alaska by the fourth quarter of 2024, as part of its objective to divest assets worth $10-$15 billion by 2028. Additionally, Chevron is implementing cost-cutting measures targeting structural reductions of $2-$3 billion from 2024 through the end of 2026.

The company reported a decline in third-quarter earnings compared to the previous year, primarily attributed to narrower margins in refined product sales, lower realizations, and the absence of favorable tax items that benefited prior periods. Chevron's earnings amounted to $4.49 billion, or $2.48 per share, down from $6.53 billion, or $3.48 per share, in the third quarter of the previous year. On an adjusted basis, earnings were $2.51 per share, compared to $3.05 per share previously. According to Thomson Reuters, analysts had forecasted earnings of $2.43 per share on average, with estimates typically excluding special items.

The company's third-quarter revenue came in at $50.67 billion, a decrease from $54.08 billion the previous year. Analysts had expected, on average, revenues of $48.99 billion. Chevron reported a 7% increase in worldwide net oil-equivalent production compared to the previous year, attributed primarily to record output in the Permian Basin and the acquisition of PDC Energy.

"Chevron launched key projects in the Anchor, Jack/St. Malo, and Tahiti fields this quarter. These developments, along with additional project start-ups anticipated through 2025, are projected to raise U.S. Gulf of Mexico production to 300,000 barrels of net oil-equivalent per day by 2026," stated Mike Wirth, CEO.

The Board of Directors has declared a quarterly dividend of $1.63 per share, to be disbursed on December 10, 2024, to shareholders of record as of the close of business on November 18, 2024.

Chevron's shares have risen by 2% in pre-market trading on Friday.