P.M. BRIEFING : High Profits Worry Chevron
NEW YORK — Chevron Corp. said today that high crude oil prices brought on by the Persian Gulf crisis will make the petroleum company’s fourth-quarter profit so big it is worried about a political backlash.
After Chevron makes a $220-million accounting deduction to reflect the divestiture of its fertilizer business, reported earnings will be in the range of $2 per share, or $700 million, Chevron Chairman Ken Derr told financial reporters at a briefing in New York. “They’re going to be high and they’re going to create a lot of flak,” he said.
In the fourth quarter of 1989, Chevron had declared an $883-million loss after taking a $1.2-billion accounting charge for costs relating to inactive oil fields and environmental cleanups. Derr called that 1989 period a “horrible quarter,” and predicted he soon will see headlines saying “our earnings are up two- to threefold” when comparisons are made.
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