Chevron, Marathon Petroleum Warn of Weaker Q4 Profits
SAN RAMON, Calif. and FINDLAY, Ohio -- Chevron Corp. and Marathon Petroleum Corp. both issued interim updates revealing that their fiscal fourth-quarter earnings will trail the companies' respective third-quarter earnings.
Chevron said its fourth-quarter profit will be "significantly" below third-quarter results, due to weaker profit margins on refining. According to the Associated Press, Chevron's refining and marketing business, which is often quite profitable, will roughly break even for the fourth quarter. Refinery margins in the United States and overseas both dropped compared to the third quarter. Refining margins on the Gulf Coast were especially weak, the news outlet reported.
Chevron, which has more than 4,000 branded locations, earned $7.83 billion for its fiscal third quarter. The company will officially report fourth-quarter results on Jan. 27.
Marathon Petroleum also announced that weaker refining margins will lead to lower profits for its fourth quarter, compared to both the prior quarter and its 2010 fiscal fourth quarter. In fact, the parent company of Speedway LLC expects to report a small loss for its 2011 fiscal fourth quarter.
During Marathon's 2010 fiscal fourth quarter, the company earned a net profit of $230 million.
"The fourth-quarter 2011 results were negatively impacted by the rapid increase in the price of West Texas Intermediate (WTI) crude oil," Marathon stated in a news release. "During the quarter [which ended Dec. 30], the prompt WTI price increased $19.63 per barrel, from $79.20 on September 30, 2011 to $98.83 on December 30, 2011."
Marathon will report its full fourth-quarter results on Feb. 1.