Chevron’s Second Quarter Profit Beats Outlook on Record Shale Production

The biggest reason Chevron’s earnings fell is that oil prices have dropped dramatically from this time last year, when they spiked due to Russia’s invasion of Ukraine.

“We’re delivering strong value to shareholders irrespective of the commodity price environment,” said CEO Mike Wirth in an interview with Barron’s. “We’re at prices that are lower than they were a year ago, but higher than they were two and three years ago. We’ve got to be prepared for high and for low prices.

“We’ve got a company that was built to last through the cycles,” he added. “At [oil prices] lower than $50, we cover all of our dividends and all of our capital spending.”

Chevron’s independent directors gave Wirth a vote of confidence, waiving the company’s mandatory retirement age of 65 for him. He will turn 63 later this year.

The company also announced its chief financial officer, Pierre Breber, is retiring after 35 years at the company. Eimear Bonner, the chief technology officer, will succeed him starting in March 2024.

In a statement, Wirth thanked Breber for his contributions and welcomed Bonner, a 24-year Chevron (ticker: CVX) veteran, saying she can “build on Chevron’s strong foundation and drive further value for shareholders.”

Chevron revealed had record quarterly production in the Permian Basin, a shale producing region in West Texas and southeaster New Mexico. Production there was11% higher than last year’s second quarter. It produced 772,000 barrels of oil equivalent a day, and added that it is on-track for its full-year guidance.

Quarterly shareholder distributions of $7.2 billion also set a record, Chevron said, including $4.4 billion in share buybacks and $2.8 billion in dividends.

Chevron expects to close the acquisition of shale driller
PDC Energy
in August.

Write to Liz Moyer at [email protected]