Chevron Anticipates 'Higher Earnings' in 4Q10

Chevron reported in its interim update that earnings for the fourth quarter 2010 are expected to be higher than in the third quarter 2010. Upstream results are projected to improve between sequential quarters, benefiting from higher crude oil prices and increased liquids liftings.

Basis for Comparison in Interim Update

The interim update contains certain industry and company operating data for the fourth quarter 2010. The production volumes, realizations, margins and certain other items in the report are based on a portion of the quarter and are not necessarily indicative of Chevron's quarterly results to be reported on January 28, 2011. The reader should not place undue reliance on this data.

Unless noted otherwise, all commentary is based on two months of the fourth quarter 2010 versus full third quarter 2010 results.

U.S. net oil-equivalent production during the first two months of the fourth quarter rose slightly, increasing by 5,000 barrels per day compared with the third quarter 2010 average. International net oilequivalent production increased 26,000 barrels per day compared with the third quarter, reflecting the completion of planned maintenance in Europe.

U.S. crude oil realizations for the first two months of the fourth quarter increased $5.58 to $77.77 per barrel. International liquids realizations also increased $7.44 to $77.11 per barrel. U.S. natural gas realizations decreased $0.64 per thousand cubic feet compared with the third quarter, while international natural gas realizations were relatively flat.

The company's general guidance for the quarterly net after-tax charges related to corporate and other activities is between $250 million and $350 million. Due to foreign currency effects and the potential for irregularly occurring accruals related to income taxes, pension settlements and other matters, actual results may significantly differ from the guidance range.


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