Chevron, the second-largest U.S. oil company, said Friday its first-quarter earnings rose 10 percent as record oil prices outweighed weak profits from gasoline production.
Oil prices have soared more than five-fold since 2002 on surging demand from emerging economies, supply concerns and the weak dollar. They broke $100 a barrel for the first time during the first quarter and hit a record of nearly $120 earlier this week.
Chevron's largest peers, Exxon Mobil , Royal Dutch Shell , and BP , all posted sizable gains in the quarter, although Exxon's results disappointed on weak production.
Chevron's net income in the quarter rose to $5.17 billion, or $2.48 a share, from $4.72 billion, or $2.18 a share, last year. Analysts, on average, had expected the company to earn $2.41, according to Reuters Estimates.
Sales and other revenue in the quarter rose 40 percent to $64.67 billion.
Benchmark U.S. oil prices averaged a record of nearly $98 a barrel during the quarter, up nearly 70 percent from a year earlier.
But margins to produce gasoline have plummeted, with refiners struggling to push through higher crude costs to customers. First-quarter gasoline prices rose only 33 percent year over year in the U.S. -- less than half crude's rise.
Profits from the company's exploration and production unit rose 76 percent to $5.13 billion, while earnings from refining and marketing plunged 84 percent to $252 million.
The company's production dipped 1.7 percent to 2.6 million barrels of oil equivalent per day, mostly due to declines of older fields in the U.S.
Argus Research analyst Phil Weiss said the company's dip in production worried him less than Exxon's output drop announced yesterday.
"Exxon's even bigger than Chevron so it takes more to move the needle," he said.
Chevron shares were up 46 cents at $95.40 in early trading on the New York Stock Exchange.
As of Thursday's close, the shares were up nearly 2 percent this year, slightly outperforming the Chicago Board Options Exchange's oil index, which is basically flat over the same period.