Chevron's (CVX) Q4 2024 earnings report highlights a net income attributable to Chevron Corporation of $17.7 billion for the year, a decline from $21.4 billion in 2023 and $35.5 billion in 2022. This represents a significant reduction in profitability over the past two years, primarily driven by lower commodity prices and reduced margins in both upstream and downstream operations.

Sales and other operating revenues for 2024 totaled $193.4 billion, slightly down from $196.9 billion in 2023 and significantly lower than $235.7 billion in 2022. The decline was attributed to lower commodity prices, which offset higher sales volumes of crude oil, natural gas, and refined products.

Upstream earnings in the U.S. increased by $3.5 billion to $7.6 billion in 2024, driven by higher sales volumes, including contributions from legacy PDC Energy assets, and the absence of decommissioning charges from previously divested Gulf of America assets. However, this was partially offset by lower realizations of $790 million. Net oil-equivalent production rose by 250,000 barrels per day, or 19%, due to growth in the Permian Basin and full-year contributions from PDC Energy.

International upstream earnings declined to $11.0 billion in 2024 from $13.3 billion in 2023, reflecting lower realizations and higher operating expenses. However, production remained relatively stable, with net oil-equivalent production at 1.739 million barrels per day, down slightly from 1.771 million barrels per day in 2023.

Downstream earnings in the U.S. fell sharply to $531 million in 2024 from $3.9 billion in 2023, primarily due to lower margins on refined product sales, which declined by $2.6 billion, and higher operating expenses of $810 million. Refinery crude unit inputs decreased by 45,000 barrels per day, or 5%, due to the upgrade of the Pasadena refinery and downtime at the Pascagoula refinery.

International downstream earnings also decreased by $1.0 billion to $1.2 billion in 2024, driven by lower margins on refined product sales and impairments of $190 million. However, refined product sales volumes increased by 50,000 barrels per day, or 3%, due to higher trading volumes.

Chevron's return on average stockholders' equity (ROSE) declined to 11.3% in 2024, compared to 13.3% in 2023 and 23.8% in 2022. Similarly, the return on average capital employed (ROCE) fell to 10.1% in 2024 from 11.9% in 2023 and 20.3% in 2022, reflecting the overall decline in profitability.

Capital expenditures increased to $16.4 billion in 2024, up from $15.8 billion in 2023, reflecting Chevron's continued investments in upstream and downstream projects, including the upgrade of the Pasadena refinery and renewable energy initiatives.

Chevron repurchased $15.2 billion of its common stock in 2024, up from $14.7 billion in 2023, as part of its stock repurchase program. Additionally, the company paid $11.8 billion in dividends to shareholders, an increase from $11.3 billion in 2023, marking the 37th consecutive year of dividend increases.

Worldwide net oil-equivalent production increased by 7% to 3.3 million barrels per day in 2024, primarily due to the full-year contribution of legacy PDC Energy production and growth in the Permian Basin. U.S. production rose to 1.599 million barrels per day, while international production slightly declined to 1.739 million barrels per day.

Chevron's refining network processed 1.8 million barrels per day in 2024, with an average crude unit distillation capacity utilization of 87.9%, down from 89.8% in 2023. U.S. refineries operated at 86.6% utilization, compared to 90.8% in 2023, due to the Pasadena refinery upgrade and downtime at the Pascagoula refinery.

The company generated $31.5 billion in cash flow from operating activities in 2024, down from $35.6 billion in 2023, primarily due to lower earnings and higher payments related to asset retirement obligations. Free cash flow, defined as cash flow from operations less capital expenditures, was also impacted by these factors.

Chevron completed the sale of its Canadian assets, including a 20% interest in the Athabasca Oil Sands Project and a 70% interest in the Duvernay shale, for $6.5 billion in December 2024, generating over $2.2 billion in sales and approximately $590 million in operational net income from these assets during the year.

The company continued to expand its renewable energy portfolio in 2024, including the commissioning of the Geismar renewable diesel plant in Louisiana, which is expected to increase production capacity to 22,000 barrels per day in 2025. Chevron also advanced its dairy biomethane projects and opened six new compressed natural gas (CNG) stations across the U.S.