ConocoPhillips, the third-largest U.S. oil company, said Thursday its worldwide production of hydrocarbons likely rose in the final three months of 2007 from the third quarter, and oil and natural gas prices were higher too.
But the company said domestic refining margins fell significantly in most regions during the October-December period versus the third quarter, and also were off slightly from the fourth quarter of 2006.
Refining margins, which hurt many oil companies' earnings in the third quarter, are the difference between what refiners pay for oil and what they are paid for the products they make from it.
The company provided the details in an overview of market and operating conditions for the recently completed fourth quarter. ConocoPhillips is scheduled to report fourth-quarter and full-year results Jan. 23.
Its share price rose $1.08 to $88.97 in trading Thursday. The stock has traded in a 52-week range of $61.59 to $90.84.
The company said it likely produced the equivalent of 60,000 barrels of oil a day more in the fourth quarter than it did in the third. The production estimates include ConocoPhillips' Canadian Syncrude operations but not its Russian Lukoil business. It did not provide figures or comparisons to the year-ago quarter.
ConocoPhillips said it expects to incur a negative $250 million after-tax impact from new production tax legislation enacted in Alaska in the fourth quarter. It said about $100 million of that impact is retroactive to prior periods in 2006 and 2007.
But the company said fourth-quarter results should get a $350 million benefit due in part to a tax-rate reduction in Canada.
The market price for oil -- based on the benchmark West Texas Intermediate -- was up about $15 a barrel in the quarter from the third quarter, and more than $30 a barrel from the year-ago period, ConocoPhillips said in its report, citing figures from Platts, a division of McGraw-Hill Cos.
Oil futures hit $100 a barrel for the first time Wednesday and reached $100 again Thursday after the government reported a larger-than-expected decline in crude oil inventories and an unexpected rise in heating oil supplies.
The market price for natural gas in the fourth quarter was up 81 cents per million British thermal units from the third quarter and about 41 cents from the fourth quarter of 2006, ConocoPhillips said.
The oil company noted its actual crude oil and natural gas prices may vary from the price indicators because of quality and other factors.
Exxon Mobil and Chevron are the largest and second-largest integrated oil companies in the U.S., respectively.