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NEW YORK -- While weak margins continue to impact its refining operations, Chevron Corp. released an interim update on Friday for the second quarter 2008, which underscored a significant earnings spike due to record-high oil and natural-gas prices.
The report reflected positive growth from its downstream refining and marketing operations which are expected to drop $500 million from the first quarter, when Chevron reported an 84 percent decline.
The Wall Street Journal reported that Chevron earnings from its upstream business, which includes exploration and production, was buoyed by higher oil and gas prices. First-quarter earnings in Chevron's oil-and-gas production segment surged 76 percent to $5.13 billion, the paper reported.
Chevron's report noted that charges are likely to be "substantially higher" than in the first quarter, which is due, in large part, to costs for environmental remediation.
The Wall Street Journal reported that during the first two months of the second quarter Chevron took in, on average, $109.19 a barrel for crude oil from its U.S. fields, up from $89.63 for the full first quarter and $58.89 a year earlier. In the global market, Chevron's crude prices increased approximately $20 a barrel from the first quarter to $106.14 a barrel.
In its report, Chevron noted that oil production was flat in the U.S. and down 2 percent internationally. While U.S. natural-gas production dipped by nearly 5 percent because of operational downtime and natural field declines. Overseas gas output fell about 3 percent, the report noted.