Chevron profit drops on weak oil price, but beats forecasts

Chevron Corp reported a drop in quarterly profit on Friday that still beat expectations as cost cuts in the company's U.S. oil production division helped mitigate some of the impact of low crude prices .

The company posted a third-quarter net income of $1.28 billion, or 68 cents per share, compared with $2.04 billion, or $1.09 per share, in the year-ago period.

Excluding one-time items, Chevron earned 49 cents per share during the quarter. By that measure, analysts expected earnings of 37 cents per share, according to Thomson Reuters I/B/E/S.

Earnings at Chevron's upstream arm, which produces oil and natural gas, jumped more than sevenfold as costs in the United States dropped and tax expenses fell.

Chevron's refining arm saw profit drop more than 50 percent as margins dropped both within and outside the United States.

Production fell about 1 percent to 2.5 million barrels of oil equivalent per day.

Shares of Chevron rose 0.6 percent to $100.51 in premarket trading.

(Reporting by Ernest Scheyder; Editing by Bernadette Baum)