Chevron Corp posted a 51 percent drop in quarterly profit on Friday, the latest oil giant to be hit by the steep decline in oil and natural gas prices and the anemic margins for refineries.
Chevron, the second-largest U.S. oil company behind Exxon Mobil , offset part of the drop in energy prices by increasing its oil output and cutting costs during the quarter, helping it beat analysts profit forecasts and lifting its shares 0.6 percent in premarket trade.
Third-quarter net profit fell to $3.83 billion, or $1.92 per share, from $7.89 billion, or $3.85 per share, in the same quarter a year before.
Excluding gains from asset sales, earnings per share of $1.72 topped the $1.47 per share that analysts had forecast, according to Thomson Reuters I/B/E/S.
Revenues fell 41 percent to $46.6 billion, slightly below the $47 billion analysts had forecast.
Rivals Exxon Mobil Corp and Royal Dutch Shell Plc dashed hopes for an imminent turnaround for the oil industry on Thursday, saying a sluggish economic recovery was weighing on energy demand and prices.
Chevron's earnings from its oil production arm fell 41 percent as an increase in output helped reduce the impact from the drop in oil prices, which reached a record in the year-ago period.
Earnings from refineries fell nearly 90 percent to $194 million, and were particularly hard hit in the United States, where the company pulled in a modest $34 million in profits during the quarter.
Chevron shares are up 5 percent so far in 2009, compared with a 16 percent gain for the Chicago Board Options Exchange <.OIX> index of oil companies, as those without refineries have fared much better with oil and gas prices recovering.
U.S. oil prices averaged $68 per barrel in the third quarter, up from nearly $60 per barrel in the second quarter, but down from $118 in the same quarter a year ago.
(Reporting by Matt Daily and Braden Reddall in San Francisco, editing by Dave Zimmerman)