Public‑Policy Conditions in U.S. Commodity Markets: Chevron’s NYSE Risk Profile in a 10‑Year Energy Sample

Tariq Abdullah-Khalil Salameh

Co-Presenters: Individual Presentation

College: College of Business and Public Management

Major: BS.ACCOUNTING

Faculty Research Mentor: Kakolyris, Andreas  

Abstract:

This project examines Chevron Corporation’s capital structure within a microeconomic environment defined by highly inelastic petroleum demand. The analysis applies a ceteris paribus framework to understand how Chevron operates within the stable financial and regulatory landscape of the United States, where risk‑free benchmarks such as U.S. Treasury securities shape investor expectations. Using the Hamada Equation, the study separates Chevron’s observed market beta into levered and unlevered components to distinguish the firm’s inherent operating risk from the effects of financial leverage. A levered beta of 0.554 and an unlevered beta of 0.291 are used to evaluate how Chevron’s risk profile interacts with its capital‑structure decisions. Financial‑statement review and margin analysis—particularly the spread between Chevron’s cost per barrel and the West Texas Intermediate (WTI) benchmark—provide insight into the company’s operational efficiency. Chevron’s long record of dividend increases further supports the assessment of financial stability and cash‑flow durability. The expected findings suggest that Chevron’s current capital structure is well‑aligned with its risk environment and that the firm is positioned to maintain resilience through in the 2026 Business Cycle. This project contributes to the broader discussion of how firms in essential commodity markets optimize capital structure under stable macroeconomic conditions.