Chevron, the second-largest US energy producer by market value, has reported profit that missed analysts' estimates for a second straight quarter as shrinking refining margins eroded gains from the biggest production increase since 2010.

Net income fell to $4.95 billion compared with $5.25 billion a year earlier, Chevron said in a statement.

Chevron shares fell the most in a month. Escalating spending on oil and natural gas developments that won't expand production for years is heightening concern among investors about future profit growth, according to Brian Youngberg, an analyst at Edward Jones. Chevron's capital outlays climbed by 26 per cent during the quarter to $115 million a day, compared with a 21 per cent increase during the April-to-June period.

“There is a lot of concern that Chevron and the other major oil companies are spending so much,” Mr Youngberg said.

“Investors want assurances that they are allocating capital appropriately and not just chasing unprofitable production growth.”

Sales rose 1.7 per cent to $56.6 billion. Profit from processing crude oil into fuels tumbled 45 per cent during the third quarter to $380 million amid rising feedstock costs and repairs at a California plant that crimped petrol and diesel output. The refining slowdown overshadowed a 2.7 per cent rise in oil and gas production led by fields from Kazakhstan to Pennsylvania, Chevron's statement added.

Chairman and chief executive officer John S. Watson is spending $36.7 billion this year in a push to raise oil and gas production that for the first nine months of this year has lagged his full-year goal of pumping the equivalent of 2.65 million barrels of oil a day. The third-quarter output boost was the largest since mid-2010. Profit from wells outside the US, which accounted for 75 per cent of the company’s global output, rose 1.2 per cent to $4.07 billion. – (Bloomberg)