Chevron meets Wall Street profit estimates but cuts buybacks in Q2

By Sheila Dang

HOUSTON (Reuters) - Chevron on Friday reported first-quarter earnings that met Wall Street estimates, but said it would spend less on share repurchases in the current quarter, reflecting the shaky economic outlook faced by Big Oil.

The company's share repurchases this year could be between $11.5 billion and $13 billion, said Chevron Chief Financial Officer Eimear Bonner, which would be in the lower end of the company's guidance of $10 billion to $20 billion.

Shares of Chevron rose 1.4% in afternoon trading.

Chevron and other oil producers have been contending with falling crude prices since April 2, when U.S. President Donald Trump announced sweeping tariffs that are expected to reduce global economic growth.

An unexpected decision by OPEC+ to increase output has further pressured oil prices, which hit a four-year low last month.

The lower crude prices have raised questions about whether producers will meet their goals for paying dividends and repurchasing shares - a cornerstone of Big Oil's strategy to woo investors - or cut capital expenditure budgets.

Chevron said it paid $3 billion in dividends and repurchased $3.9 billion in shares during the quarter.

In the second quarter, the company said it expects to repurchase between $2 billion and $3.5 billion in shares. If rolled forward, that would mean Chevron could land between $11.5 billion and $13 billion in repurchases for 2025, Bonner said in an interview.

"We're still buying back a significant amount of our shares annually, on top of a dividend that's growing faster than our peers," she said.

The second-largest U.S. oil producer posted adjusted earnings of $3.8 billion during the three months ended March 31, or $2.18 per share, matching analyst estimates, according to LSEG data.

Chevron's global oil production totaled 3.35 million barrels of oil equivalent per day (boepd), flat from the same period last year. Earnings from oil and gas production were $3.76 billion, down from $5.24 billion in the year-ago quarter.

Refining profit improved from the previous quarter, when Chevron's downstream operations reported the first loss in four years.

During an earnings conference call, analysts repeatedly asked Chevron about its production in Kazakhstan and Venezuela, which has been caught in geopolitical crosshairs. Kazakhstan has consistently exceeded OPEC+ oil production quotas, raising questions about whether Chevron will curtail output from the Tengiz oilfield, while the Trump administration hit the company with an order to wind down operations in Venezuela.

Chevron CEO Mike Wirth said he traveled to Kazakhstan last month to meet with President Kassym-Jomart Tokayev and the two men discussed mutual interest in extending the project's contract beyond 2033. Wirth later said they did not discuss curtailing production.

Bonner told Reuters the company is operating unrestricted.

Meanwhile, Chevron's license to operate in Venezuela is set to expire May 27.

"We're in dialogue with the (U.S.) government on how that license will be modified and extended if, in fact, that's what they choose to do," Wirth said during the conference call.

The company is also set to defend its planned $53-billion acquisition of oil producer Hess, which would give it a crucial foothold in a prolific oilfield off the coast of Guyana. Exxon and CNOOC filed arbitration challenges that have delayed closure of the deal.

An arbitration hearing in the case is scheduled for May 26 in London.

(Reporting by Sheila Dang in Houston; Editing by Nia Williams, Shounak Dasgupta, Chizu Nomiyama and Nick Zieminski)

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