Dented Chevron

27 January 2012 By Christopher Swann

Knocking $6 bln off Chevron’s market value looks like an over-reaction. The hit makes the second-largest U.S. oil company even cheaper compared to rivals. The recent weakness in refining will pass, and the firm has strong finances and the sector’s lowest exposure to cheap gas.

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Chevron reported lower than expected fourth-quarter earnings on Jan. 27 as rising spending on oil and gas projects and losses at its refinery business offset gains from higher crude oil prices.

Oil and gas output at the No. 2 U.S. oil company by market value also declined to 2.64 million barrels a day from 2.79 million barrels a day a year ago.

Fourth-quarter profit slipped to $5.1 billion, or $2.58 per share, from $5.3 billion, or $2.64 per share, a year earlier.

Shares in Chevron were trading down 3 percent in early New York trading on Jan. 27, giving the company a market capitalization of about $206 billion.

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