Chevron (NYSE:CVX) reported second-quarter 2026 earnings of $12.1 billion, or $6.11 per share, as higher upstream realizations, production volumes and refining margins lifted results. Adjusted earnings were $12 billion, or $6.06 per share, while cash flow from operations excluding working capital totaled nearly $20 billion.
Chairman and CEO Mike Wirth said the company’s global upstream production increased more than 5% from the first quarter, supported by operating reliability across major assets. U.S. upstream production reached a record nearly 2.1 million barrels of oil equivalent per day, while refinery throughput surpassed 1 million barrels per day.
Cash flow, capital spending and cost reductions
Chevron generated $19.7 billion in cash flow from operations excluding working capital and $15.4 billion in adjusted free cash flow during the quarter. The company reduced debt by more than $8 billion, bringing net debt to cash flow from operations to 0.6 times at quarter-end.
Organic capital expenditures were $4.4 billion in the quarter. Bonner said Chevron now expects full-year capital spending to finish at the low end of its $18 billion to $19 billion guidance range. The company continues to maintain a longer-term capital outlook of $18 billion to $21 billion, a range that includes expected investment in its power business.
The company also said it achieved its $3 billion structural cost-reduction target six months earlier than planned. More than 70% of those savings came from efficiency improvements, according to Bonner, including benefits from Chevron’s organizational restructuring, centralized technical work, predictive maintenance and turnaround optimization.
“Costs always matter. They always will,” Bonner said, adding that the company views the savings as sustainable because the initiatives have been embedded in its operating model.
Tengiz performance and Hess integration
Chevron cited strong performance at Tengizchevroil, its Kazakhstan affiliate, as a major driver of the quarter’s production growth. Wirth said production at the operation rose by 170,000 barrels per day from the first quarter, with each month of the second quarter among the asset’s highest-volume months.
Bonner said Chevron completed a low-capital modification during a fourth-quarter 2025 turnaround at Tengiz’s third-generation plant. The work increased the facility’s nameplate oil capacity to 320,000 barrels per day from 260,000 barrels per day, lifting total field processing capacity to slightly more than 1 million barrels per day.
The company said operations on the Caspian Pipeline Consortium pipeline, which is the primary export route for Tengiz production, were continuing. Wirth said two single-point moorings were in service and a third, which has been undergoing refurbishment, is expected to return in the third quarter. Chevron can also use rail, shipments across the Caspian and storage as mitigation options, he said.
Chevron also said it reached Hess acquisition synergy objectives ahead of schedule. Wirth said the company realized $1.5 billion in synergies, 50% more than initially targeted and six months early. The acquired assets have generated free cash flow that was roughly double the incremental dividends associated with the transaction, he said.
In Guyana, Chevron expects the former Hess assets to support high-margin oil growth into the 2030s. In the Bakken, the company said it is applying practices from its broader shale and tight portfolio, including drilling laterals that are 28% longer on average, improving workovers and using advanced chemicals. Chevron said it is maintaining similar Bakken production with one fewer rig.
Shale efficiency and international opportunities
Chevron’s shale and tight portfolio produces about 1.7 million barrels per day, including roughly 1 million barrels per day from the Permian Basin, 400,000 barrels per day from the DJ Basin and 200,000 barrels per day from the Bakken, Wirth said.
The company expects to spend 25% less capital per barrel of oil equivalent in 2026 than it spent in 2025. In the Permian, capital spending is expected to fall below $3.5 billion this year, Bonner said, as Chevron emphasizes free cash flow, drilling and completion efficiency, artificial-lift optimization and facility reliability rather than volume growth alone.
Wirth said Chevron sees multiple longer-term growth options beyond the Permian, including Guyana, the Eastern Mediterranean, Argentina, West Africa and newly acquired exploration acreage. He said the company increased its acreage position by 35% over roughly the past year and closed on 10 million net acres in South America, the Mediterranean and the Gulf of America during 2026.
Chevron is also advancing discussions in Iraq regarding West Qurna-2 and Nasiriyah. Wirth said the company has signed follow-on agreements that advanced commercial discussions and that potential terms appear competitive within Chevron’s portfolio, though final agreements have not been reached.
In Venezuela, Bonner said Chevron expects to fully recover outstanding debt by early 2027. Production from its three joint ventures has increased from 40,000 barrels per day several years ago to 280,000 barrels per day, including 15% growth over the past six months. Chevron expects production from those ventures could rise by as much as 50% by the end of 2028.
Microsoft power agreement and market outlook
Chevron recently signed a 20-year, take-or-pay power purchase agreement with Microsoft for 2.67 gigawatts of firm behind-the-meter capacity at Project Kilby in West Texas. President of New Energies Jeff Gustavson said permitting and engineering, procurement and construction work are progressing toward a final investment decision later this year.
Chevron expects Project Kilby to generate mid-teens returns and long-duration contracted cash flow that is not tied to commodity prices. The company said it is in advanced discussions with existing and prospective customers regarding additional projects, while emphasizing that it will prioritize value and return thresholds over growth.
On commodities, Wirth said middle-distillate markets appeared particularly tight, while refined-product inventories were lower than crude inventories globally. He said Chevron expects upward pressure on product prices into the third quarter and potentially beyond, though the timing of any normalization in crude and product flows remains uncertain.
Chevron reaffirmed its 2030 objectives of annual production growth of 2% to 3%, adjusted free-cash-flow growth averaging more than 10% per year and more than 3% improvement in return on capital employed, all based on flat commodity prices below current levels.
About Chevron (NYSE:CVX)
Chevron Corporation (NYSE: CVX) is an American multinational energy company engaged in virtually all aspects of the oil and gas industry. As an integrated energy firm, Chevron’s core activities include upstream oil and natural gas exploration and production, midstream transportation and storage, downstream refining and marketing of fuels and lubricants, and petrochemical manufacturing through joint ventures and subsidiaries. The company markets fuels under brands such as Chevron, Texaco and Caltex and supplies a range of products and services to retail customers, industrial users and commercial fleets worldwide.
Chevron traces its corporate lineage to the early petroleum companies that eventually became Standard Oil of California and has evolved through significant mergers and restructurings, including the acquisitions of Gulf Oil and Texaco.
