APA beats third-quarter profit estimates on strong natural gas demand

Nov 5 (Reuters) - Oil and gas company APA APA.O beat Wall Street estimates for third-quarter profit on Wednesday, as strong demand for natural gas helped counter weaker oil production.

Average natural gas prices jumped 26% over the year earlier to $3.25 per million British thermal units during the quarter, fueled by a surge in power demand from data centers dedicated to artificial intelligence and cryptocurrency.

APA said quarterly average realized price for natural gas was at $2.25 per thousand cubic feet, up 57% from a year earlier, while its production was up about 18% at 932 million cubic feet per day (mmcfpd).

The company's total production, however, fell about 1% to 413,144 barrels of oil equivalent per day (boepd), weighed by a 9% decline in oil output.

Oil prices were down about 14% at $67.43 per barrel.

Crude demand and prices fell during the quarter as OPEC+ accelerated output hikes and oversupply fears mounted amid trade tensions threatening global growth and energy demand.

APA raised its U.S. oil production forecast for the fourth quarter to 123,000 bpd. Still, that was lower than the 147,573 bpd it reported a year ago.

Meanwhile, as a part of its cost-reduction efforts amid volatile price environment, APA accelerated its savings plan and now expects to achieve $350 million in annual savings by 2025-end, two years ahead of schedule.

The company also anticipates an additional $50 million to $100 million in yearly savings by the end of 2026.

APA posted an adjusted profit of 93 cents per share for the three months ended September 30, compared with analysts' average estimate of 79 cents per share, according to data compiled by LSEG.

Its shares were up 1.6% in extended trading.