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Chevron Corp., which completed its $39.5 billion acquisition of Texaco Inc. earlier this month to form ChevronTexaco Corp., said yesterday that third-quarter profits fell as a downturn in demand contributed to a drop in crude oil prices.
Chevron reported third-quarter net income fell to $1.168 billion from $1.531 billion in the year ago period. Excluding charges for special items in both quarters, earnings fell 27 percent to $1.199 billion, the company said.
ChevronTexaco Chairman and CEO Dave O'Reilly blamed part of the earnings drop on crude oil prices, which have been hurt by weaker demand during the economic slowdown. "Weakened demand in the world economies, even before the tragedies of September 11, pushed oil and gas prices significantly lower than the year-ago quarter," he said in a statement.
Chevron said third-quarter revenues and other income fell to $11.9 billion from $13.6 billion in the 2000 third quarter.
Separately, Texaco's third-quarter net income dropped to $101 million from $798 million. "In the upstream, ample supplies and weakening demand caused commodity prices to fall well below last year's levels, lowering our results. In the downstream, earnings improved compared to a year ago on the strength of higher marketing margins," said Glenn Tilton, vice chairman of ChevronTexaco and former chairman and CEO of Texaco Inc. "However, our downstream earnings were well below record results in the second quarter of this year."