EARNINGS / ENERGY : Exxon, Chevron Profits Surge; Gulf Crisis Cited

Exxon Corp., the nation’s biggest oil company, on Thursday reported a huge 121% jump in fourth-quarter earnings, reflecting the leap in crude oil prices because of the Persian Gulf crisis and costs in 1989 over the Valdez oil spill.

Chevron Corp., the nation’s No. 4 oil company, reported fourth-quarter income of $633 million, contrasted with a loss of $883 million a year earlier.

“Virtually all the quarterly earnings improvement was centered in foreign exploration and production, primarily attributable to higher market prices for crude oil,” Exxon Chairman Lawrence Rawl said in a statement.

Exxon’s fourth-quarter earnings were $1.56 billion, compared to $485 million a year ago.

Fourth-quarter revenue was $35.26 billion, compared to $26.76 billion in the fourth quarter of 1989.

Sensitive to criticism that oil companies profited from the gulf crisis and passed higher prices on to consumers, Exxon noted that it had lowered its prices for “key products such as motor gasoline” for much of fourth quarter 1990.

“Some of the decline in U.S. gasoline prices late in the quarter was masked from consumers by the 5-cents-a-gallon increase in the federal excise tax effective Dec. 1,” Rawl said.

Chevron Chairman and Chief Executive Kenneth T. Derr said the rosy profits of the fourth quarter are probably not sustainable as crude prices fall off their peaks.

Oil costs about $20 to $25 a barrel, slightly higher than pre-invasion levels but well below the record high set in October of more than $41 a barrel.

“In view of the uncertainty about what may occur in the Middle East and how crude oil and petroleum products markets may respond, it is impossible to forecast what conditions we may face,” Derr said.

The San Francisco-based firm’s fourth-quarter revenue was $13.5 billion, compared to $8.58 billion a year ago.

For the year, Exxon reported net income of $5.01 billion, compared to $3.51 billion in 1989. Revenue in 1990 was $117.08 billion, compared to $96.29 billion in 1989.

However, year-to-year comparisons were helped by heavy charges in 1989 from the Valdez oil spill.

Exxon’s 1989 results included an $800-million charge as part of the cleanup in the fourth quarter and $1.68 billion for all of the year.

For all of 1990, Chevron earned $2.16 billion, compared to $251 million in 1989. Revenue in 1990 was $41.5 billion, compared to $31.9 billion in 1989.

Earnings for 1989 reflected special charges of $1.21 billion, mainly for property writedowns, including the Point Arguello project offshore Southern California, Chevron said.

Start-up of the Point Arguello project has been stalled by local opposition.

Chevron profited earlier in 1990 on sales of refined products and on exploration and production when crude oil prices rose after the Aug. 2 Iraqi invasion of Kuwait, Derr said.

“Our 1990 earnings performance can best be characterized by splitting it into pre- and post-Middle East crisis,” he said.

OIL COMPANIES Fiscal Year Exxon (1990): $5,010* Exxon (1989): $3,510* Chevron (1990): $2,150*Chevron (1989): $251* Fourth quarter Exxon (1990): $1,560* Exxon (1989): $485* Chevron (1990): $633*Chevron (1989): -$833* * In millions