CREDO REPORTS FIRST QUARTER 2005 EARNINGS
Lower Earnings Due to the Timing of Initial Production From New Wells

DENVER, COLORADO, March 17, 2005 - CREDO Petroleum Corporation (NASDAQ: CRED)  today reported financial results for the three months ended January 31, 2005. Net income was $909,000 on revenue of $2,606,000. This compares to net income of $1,165,000 on revenue of $2,850,000 last year when flush production from new wells pushed both income and production to all-time quarterly highs. On a per diluted share basis, net income was $.15 compared to $.19 last year. Cash flow from operating activities (before changes in operating assets and liabilities) fell 8% to $1,801,000.

James T. Huffman, President said, "The timing of production from new wells is primarily responsible for lower gas production and net income this quarter compared to last year. Last year, flush production from five new wells pushed first quarter volumes and net income to all-time highs. By comparison, there was only one comparable new well that contributed such flush production this quarter."

Huffman further stated, "Our drilling successes occur unevenly, and we do not attempt to time drilling or initial production from new wells to affect quarter-to-quarter financial and operating results. For example, we carefully tested the lowest productive zone in the Skyler #1-6 well during the first quarter before moving up-hole to the current producing zone in mid-January (see separate press release today). Had we immediately completed the higher potential zone, the Skyler would have made-up virtually all of the quarter-to-quarter production differential."

PRODUCTION VOLUMES DECREASE

First quarter production fell 16% to 436 MMcfge (million cubic feet of gas-equivalent) compared to an all-time quarterly high last year of 518 MMcfg. Natural gas production declined 17% to 382 MMcfg and oil production fell 10% to 9,000 barrels.

PRODUCT PRICES SHOW CONTINUED STRENGTH

Total natural gas price realizations increased 4% to $5.25 per Mcf compared to $5.03 last year. Hedging transactions reduced wellhead prices $.59 per Mcf this year and increased them by $.18 per Mcf last year. Wellhead oil prices increased 42% to $42.67 per barrel compared to $29.95 last year.

The company currently has open hedge positions totaling 690 MMbtu covering the months of April through September 2005 and December 2005 and January 2006. The hedges cover approximately 50% of the company's estimated production for April through September and 15% for December and January. The hedge positions are comprised of 630 MMbtu of collars with a weighted average floor price of $5.98 and a weighted average ceiling price of $7.08 and 60 MMbtu in short swaps with a weighted average price of $6.37. Subsequent to first quarter-end, hedges for February and March were closed at a small gain. Average gas prices in the company's market areas are expected to be 15% to 17% below NYMEX prices due to basis differentials and transportation costs.

STRONG FINANCIAL CONDITION PROVIDES SOLID FOUNDATION FOR GROWTH

At January 31, 2005, working capital was $6,305,000. Total assets were $31,693,000 including cash and short-term investments of $6,583,000. Stockholders' equity was $22,364,000. The company's only long-term debt is a $355,000 exclusive license obligation.

OPERATIONS AND CAPITAL SPENDING

CREDO's business focuses on two core projects -- natural gas drilling and application of its patented Calliope Gas Recovery System. The company believes that, in combination, these two projects provide an excellent (and possibly unique) balance for achieving its goal of adding long-lived reserves and production at reasonable costs and risks. Capital spending for the first quarter 2005 totaled $2,377,000. A separate press release has been made today updating drilling and Calliope results.

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CREDO Petroleum Corporation is a publicly traded independent energy company headquartered in Denver, Colorado. The company is engaged in the exploration for and the acquisition, development and marketing of natural gas and crude oil in the Mid-Continent and Rocky Mountain regions. The company's stock is traded on the NASDAQ System under the symbol "CRED" and is quoted daily in the "NASDAQ Small-Cap Issues" section of The Wall Street Journal.

For 2005, cash flow from operating activities (before changes in operating assets and liabilities) consists of net income of $909,000, DD&A of $477,000, deferred income taxes of $385,000, and other of $30,000. For 2004, such cash flow consists of net income of $1,165,000, DD&A of $429,000, and deferred income taxes of $362,000.

This press release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements included in this press release, other than statements of historical facts, address matters that the company reasonably expects, believes or anticipates will or may occur in the future. Such statements are subject to various assumptions, risks and uncertainties, many of which are beyond the control of the company. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those described in the forward-looking statements.

CREDO PETROLEUM CORPORATION
FINANCIAL HIGHLIGHTS

                                       Three Months       Three Months
                                          Ended               Ended
Condensed Operating                     January 31,        January 31,
 Information (Unaudited)                   2005               2004
                                        -----------        -----------
Revenues:
   Oil and gas sales                   $ 2,385,000        $ 2,605,000
   Operating                               159,000            137,000
   Investment income and other              62,000            108,000
                                        -----------        -----------
                                         2,606,000          2,850,000
                                        -----------        -----------
Costs and expenses:
   Oil and gas production                  488,000            460,000
   Depreciation, depletion and
    amortization                           477,000            429,000
   General and administrative              369,000            331,000
   Interest                                  9,000             12,000
                                        -----------        -----------
                                         1,343,000          1,232,000
                                        -----------        -----------

Income before income taxes               1,263,000          1,618,000

Income taxes                             (354,000 )          (453,000)
                                        -----------        -----------

Net income                             $   909,000        $ 1,165,000
                                        ===========        ===========
Earnings per share of Common
 Stock - Basic                         $       .15        $       .19
                                        ===========        ===========
Earnings per share of Common
 Stock - Diluted                       $       .15        $       .19
                                        ===========        ===========

Condensed Balance Sheet                 January 31,        October 31,
 Information                               2005                2004
                                        -----------        -----------

Cash and Short-Term Investments        $ 6,583,000        $ 6,889,000
Other Current Assets                     2,854,000          3,128,000
Oil and Gas Properties, Net             20,797,000         19,509,000
Exclusive License Agreement, Net           390,000            408,000
Other Assets                             1,069,000          1,042,000
                                        -----------        -----------

                                       $31,693,000        $30,976,000
                                        ===========        ===========

Current Liabilities                    $ 3,132,000        $ 4,406,000
Deferred Income Taxes                    5,167,000          4,605,000
Exclusive License Agreement
 Obligation                                297,000            297,000
Asset Retirement Obligation                733,000            748,000
Stockholders' Equity                    22,364,000         20,920,000
                                        -----------        -----------
                                       $31,693,000        $30,976,000
                                        ===========        ===========