                                Chevron & Exxon

                                    1/26/94

                      Stock     Price      52 week     YTD Pr    Div  Gross
                      Rating     1/25   --- Range ---    Chg     Rate Yield
Mobil Corp.             MO      79.88       85-62         1      3.40  4.3
Exxon Corp.             MO      66.25       69-60         5      2.88  4.4
Chevron Corp.           MO      92.50       99-69         6      3.50  3.8

                                            ----Interim----    1994E  pr/94
          FY/IP       EPS93     EPS94 PE94  --Next- -YrAgo-   EBITDA EBITDA
MOB       12/01Q      5.42      5.70E 14.3     n/a     n/a     14.45   5.5
XON       12/01Q      3.67      4.05E 16.0     n/a     n/a      9.70   6.8
CHV       12/01Q      6.57      6.60E 13.9     n/a     n/a     15.40   6.0

1.  Analysts continue to rate Mobil, Exxon and Chevron moderate outperformers.
All reported fourth-quarter earnings somewhat higher than expected.
Analysts are not materially changing our 1994/1995 estimates for any of these
companies.
These estimates are:  (1) Mobil = $5.70 (up from $5.60) for 1994 and $6.20
for 1995; (2) Exxon = $4.05 for 1994 and $4.75 for 1995 and (3) Chevron =
$6.60 for 1994 and $7.10 for 1995.

2.  All three companies reported earnings from operations that were
somewhat higher than consensus estimates, as did Texaco the previous day.
The common thread was that refining/marketing earnings were particularly
strong, especially in the Far East and Latin America, and gains in this
segment more than offset the impact of sharply lower crude oil prices on
the exploration/production sector.  Investors had expected this general
pattern, but the magnitude of the gains in the refining/marketing sector
was more than been forecast.  All three companies had one-time items:
Exxon's were positive and those of Chevron and Mobil were negative.  Thus,
on a reported basis, Exxon showed a gain in earnings, but Chevron and Mobil
showed substantial declines.  Analysts and investors will focus on the
operating and not the reported numbers, however.

3.  Adjusted fourth-quarter earnings were as follows: (1) Mobil, $1.47
versus $1.42 a year ago, bringing the full year's adjusted net per share to
$5.42 versus $3.58 in 1992; (2) Exxon, $1.11 versus $1.10 a year ago,
bringing the full year's adjusted net per share to $3.67 versus $3.51 in
1992 and (3) Chevron, $1.68 versus $1.54 a year ago, bringing the full
year's adjusted net per share to $6.57 versus $4.33 in 1992.  Mobil and
Chevron benefited substantially during the year from cost-cutting
initiatives and from the strength in U.S. gas prices.  U.S. gas is
relatively small to Exxon; plus, it had initiated cost-cutting efforts
earlier and, thus, did not experience the same rate of year-over-year gain.

4.  On the operational side, analysts think it of interest that the U.S.-based
international oil companies who have reported so far--Exxon, Mobil and
Texaco--and that have meaningful European refining/marketing operations
have all shown higher product sales in this year's fourth quarter than last
year, and the same observation holds true for the entire year of 1993.
Europe is the market most plagued by recession and the most vulnerable,
therefore, to lower petroleum consumption.  Instead, we are seeing modest
gains.  This suggests to us that underlying consumption and demand trends
are stronger than many observers think.  In a better economic environment,
this could well contribute to a currently unexpected surge in petroleum
product demand.

5.  API inventory data released last night showed a large decline in
heating oil and crude oil inventories in the United States, clearly showing
the effect of the recent cold weather in the Northeast.  Heating oil stocks
were down 8.2 million barrels, and crude oil fell by 4.8 million barrels.
Total inventories of crude oil and principal refined products now stand 7
million barrels below last year.  Crude oil stocks are about level with
last year, as is gasoline.  Distillate stocks are 10 million barrels lower.
This can't be all bad.
