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    Chevron Q4 Net Income Falls

    Company sees low margins on refined products, weak demand and excess supply.

    SAN RAMON, Calif. -- Chevron Corp. saw earnings of $3.07 billion during the fourth quarter 2009, a decrease from the $4.90 billion earned in the year-go period, which had included a $600 million gain from an upstream asset-exchange transaction and positive foreign-currency effects of $478 million in the fourth quarter 2008. In the just-ended quarter, the company saw foreign-currency effects reduce earnings by $67 million.

    Full-year 2009 earnings slipped to $10.48 billion, down 56 percent from $23.93 billion in 2008.

    Sales and other operating revenues in the fourth quarter 2009 were $48 billion, up from the $43 billion in the year-ago quarter. For the full-year, sales and other operating revenues were $167 billion, down from the $265 billion in 2008, and primarily due to lower prices for crude oil, natural gas and refined products.

    "Earnings decreased in 2009 as a result of lower crude oil and natural gas prices and a decline in refined product sales margins, driven by a weak global economy," Chevron Chairman and CEO John Watson said in a statement. "In this challenging environment, Chevron's successes in operational reliability and cost management made valuable contributions to our bottom line."

    He added: "In our downstream business, our operated refineries continued to run reliably during the fourth quarter. However, this operational success did not offset the effects of low margins on the sale of gasoline and other refined products due to weak demand and excess supply worldwide."

    Chevron's U.S. downstream operations saw a net loss of $345 million in the fourth quarter 2009, compared with earnings of $1.03 billion a year earlier, mainly the result of weaker margins on the sale of gasoline and other refined products.

    Refined-product sales totaled 1.35 million barrels per day, down 60,000 barrels per day from the fourth quarter 2008, mainly due to weaker demand for jet fuel and gas oils. Meanwhile, branded gasoline sales decreased 2 percent to 595,000 barrels per day, also due to weaker demand, according to the company.

    Watson noted on-going cost-management efforts companywide resulted in a roughly 15-percent decrease in operating, selling, general and administrative expenses in 2009 compared with the previous year.

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