Chevron CEO on earnings, preserving dividend, outlook and more

Chevron CEO Michael Wirth joins "Squawk Box" to discuss quarterly earnings results, steps the company is taking to preserve dividend and more.

Chevron shares dropped on Friday after the company warned that results will remain depressed as long as oil prices stay low, and said it was further cutting its 2020 capital spending plan.

For the first quarter, Chevron reported earnings per share of $1.93, which included $680 million in one-time favorable items, and $31.5 billion in revenue, helped by downstream margins and increased production in the Permian Basin. In the same quarter a year earlier, the oil giant earned $1.39 per share on $35.20 billion in revenue.

Production at the nation’s second-largest oil company rose 6% year over year to reach a record high of 3.24 million barrels per day of net oil-equivalent production. Chevron said production in the Permian rose 48% year over year.

Looking forward, Chevron said it will cut between 200,000 and 300,000 barrels of oil-equivalent production in May, and between 200,000 and 400,000 barrels of oil-equivalent production in June.

Chevron said lower oil prices will continue to have a significant impact. “Financial results in future periods are expected to be depressed as long as current market conditions persist,” the company said. Chevron said that in the first quarter, the average price per barrel of crude and natural gas liquids was $37, roughly 23% lower than a year earlier, while the sale price for natural gas dropped from $1.64 to 60 cents.

Shares of Chevron were down more than 4% on Friday.

Energy companies have been forced to slash spending and cut costs following a historic drop in West Texas Intermediate, the U.S. oil benchmark, whose price shed 70% this year. Much of the decline is thanks to a drop-off in demand due to the coronavirus.

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