Occidental Beats Guidance With Strong Q3 Production

Occidental Petroleum Corporation (NYSE: OXY) posted third-quarter 2025 net income of $661 million, or $0.65 per diluted share, with adjusted earnings of $649 million ($0.64/share), as strong upstream performance and disciplined capital spending lifted operating cash flow and exceeded production targets.

The Houston-based producer generated $2.8 billion in operating cash flow and $1.5 billion in free cash flow before working capital, supported by solid oil and gas output and steady commodity prices. Total company production reached 1.465 million barrels of oil equivalent per day (Mboed)—above the high end of guidance—driven by strength in the Permian (800 Mboed), Rockies (288 Mboed), and International (238 Mboed) segments.

CEO Vicki Hollub credited the results to “exceptional operational execution” across Occidental’s portfolio, adding that the upcoming sale of OxyChem marks a major step in the company’s strategic transformation. Proceeds from the sale are expected to bolster the balance sheet and fund “high-return opportunities” across the core oil and gas business.

Segment highlights include:

• Oil & Gas: Pre-tax income rose to $1.3 billion, up from Q2, supported by higher crude volumes and pricing. Occidental’s average realized oil price increased 2% quarter-on-quarter to $64.78 per barrel, while domestic natural gas prices climbed 11% to $1.48/Mcf.

• OxyChem: Pre-tax income dropped to $197 million, as lower product prices and volumes offset gains from cheaper feedstocks.

• Midstream & Marketing: Delivered $93 million in pre-tax income, exceeding guidance despite weaker gas spreads and rising expenses tied to low-carbon ventures. Occidental’s Western Midstream (WES) equity income added $156 million.

Occidental continued deleveraging, repaying $1.3 billion in debt during the quarter, bringing total principal debt down to $20.8 billion. The company spent $1.8 billion on capital projects and received $39 million from noncontrolling interests, highlighting its balanced approach to investment and shareholder returns.

The results underscore Occidental’s position as a leading U.S. oil producer with growing exposure to lower-carbon ventures through its Oxy Low Carbon Ventures unit, even as it continues to streamline its portfolio through divestments like OxyChem.

By Charles Kennedy for Oilprice.com

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