OXY

It has been about a month since the last earnings report for Occidental Petroleum (OXY). Shares have added about 8.2% in that time frame, outperforming the S&P 500. Will the recent positive trend continue leading up to its next earnings release, or is Occidental due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Occidental Petroleum Corporation before we dive into how investors and analysts have reacted as of late. Occidental Q2 Earnings Beat on Oil Prices and Midstream StrengthOccidental Petroleum Corporation reported second-quarter 2026 adjusted earnings of $2.40 per share, surging 823.1% year over year and beating the Zacks Consensus Estimate of $1.92 by 25%. Higher realized crude oil prices and a sharp improvement in Midstream and Marketing supported results. Midstream and Marketing reported adjusted pre-tax income of $961 million, exceeding the high end of the company’s guidance. The segment posted adjusted income of $106 million in the year-ago quarter.Reported earnings were $2.75 per share compared with 26 cents a year earlier. Revenues climbed 57.1% to $8.33 billion and surpassed the Zacks Consensus Estimate of $7.18 billion by 16%.Oil and Gas revenues totaled $6.88 billion, up 37.4% from $5.01 billion in the year-ago quarter. Higher commodity realizations more than offset weakness in domestic natural gas pricing. Midstream and Marketing revenues jumped 240% year over year to $1.33 billion. Interest, dividends and other income totaled $82 million compared with $43 million a year earlier. Worldwide production reached 1,433 thousand barrels of oil equivalent per day (Mboe/d), exceeding the high end of management’s guidance of 1,390-1,430 Mboe/d. Strong domestic performance helped total production rise 2.4% year over year. Permian Resources production averaged 804 Mboe/d, up from 770 Mboe/d in the second quarter of 2025. Production from the region also exceeded the guidance of 783-803 Mboe/d.Gulf of America output rose to 144 Mboe/d from 125 Mboe/d, benefiting from strong base performance and maintenance optimization. Rockies and Other Domestic production increased to 280 Mboe/d from 272 Mboe/d. International production declined to 205 Mboe/d from 233 Mboe/d, partly reflecting disruptions in the Middle East. Occidental’s worldwide realized crude oil price increased 51.8% year over year to $96.78 per barrel. The average WTI and Brent marker prices were $92.79 and $97.06 per barrel, respectively, up from $63.74 and $66.59.Worldwide realized natural gas liquids prices advanced 19% to $24.64 per barrel. However, domestic realized natural gas prices were negative $1.48 per thousand cubic feet in contrast to a positive $1.33 in the prior-year period, limiting part of the commodity-price benefit. Total costs and other deductions declined 4% year over year to $4.55 billion. Oil and gas lease operating expenses slipped 1.6% to $1.12 billion, while transportation and gathering costs increased 3.3% to $463 million. Depreciation, depletion and amortization expenses rose 1.3% to $1.85 billion. Interest and debt expense fell 60.1% to $108 million, reflecting the company’s accelerated debt-reduction efforts. In the first half of 2026, the company brought online 256 wells in the Permian and 84 wells in the Rockies region, which boosted domestic production volumes. In the second quarter, operating cash flow from continuing operations totaled $5.09 billion. Excluding working-capital movements, operating cash flow was $4.61 billion. Capital expenditures totaled $1.59 billion, resulting in free cash flow before working capital of $3.02 billion.Occidental reduced principal debt by $1.9 billion during the quarter to $11.8 billion. The company retired $8.6 billion of debt during the first half of 2026 and ended June with $4.15 billion in cash and cash equivalents. Management also raised the quarterly dividend by 8% to 28 cents per share. For 2026, Occidental now expects total production of 1,423-1,453 Mboe/d compared with earlier expectation of 1,410-1,460 Mboe/d. The outlook includes Permian production of 801-817 Mboe/d and Gulf of America production of 132-136 Mboe/d. In 2026, OXY plans to bring between 485 and 515 wells online in the Permian and 150-170 wells in the Rockies region.The company projects full-year Midstream pre-tax income of $1.3-$1.5 billion. Net capital expenditures are expected between $5.5 billion and $5.9 billion, while adjusted interest expense is forecasted at approximately $680 million. Exploration expenses are expected to be $290 million.For the third quarter of 2026, OXY expects production in the band of 1,400-1,440 Mboe/d. Output from the Permian Resources segment is anticipated at 795-815 Mboe/d. Occidental expects international production volumes for the third quarter of 2026 to be in the range of 225-231 Mboe/d. It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 18.97% due to these changes. At this time, Occidental has a nice Growth Score of B, a score with the same score on the momentum front. Charting a somewhat similar path, the stock has a grade of A on the value side, putting it in the top quintile for value investors. Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Occidental has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Occidental is part of the Zacks Oil and Gas - Integrated - United States industry. Over the past month, National Fuel Gas (NFG), a stock from the same industry, has gained 3.6%. The company reported its results for the quarter ended June 2026 more than a month ago. National Fuel Gas reported revenues of $537.5 million in the last reported quarter, representing a year-over-year change of +1.1%. EPS of $1.54 for the same period compares with $1.64 a year ago. National Fuel Gas is expected to post earnings of $1.18 per share for the current quarter, representing a year-over-year change of -3.3%. Over the last 30 days, the Zacks Consensus Estimate has changed -6.4%. National Fuel Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report National Fuel Gas Company (NFG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Management's own scorecard still leads with dollars, but the return measure that used to sit beside it was absent again, and that changes what a holder is actually betting on. ExxonMobil (XOM) has returned 46% over the past year against roughly 20.5% for the S&P 500, and it earned $14.5 billion in the second quarter of 2026. Set what management foregrounds now beside what it led with two years ago, and one measure has slipped out of the lead: what its capital actually earns. The Latest Results Leave Out The 13% Return on Capital Reporting on 2024, management led with full-year earnings of $34 billion and cited a return measure alongside them: "return on capital employed of 13%." What it foregrounds in the second quarter of 2026 is levels and running totals instead: $14.5 billion of earnings and $16.3 billion of cumulative structural cost savings since 2019. Neither says what the capital base earns. That savings program's latest step came in July 2026, when upstream operations were folded into one global operations organization of roughly 31,000 employees. A Fifth Vessel In Guyana And A Record In The Permian Much of the cash behind those totals goes back into a capital base that keeps growing: cash capital expenditures ran roughly $7 billion in the second quarter of 2026. The Guyana venture has recovered the $55 billion it invested there, nearly two years earlier than anticipated, and its fifth production vessel, Errea Wittu, sailed in June 2026 and, management said in July, remained on track for start-up by the end of 2026. Permian volumes set a record above 1.8 million oil-equivalent barrels a day, produced from acreage that supports extended reach laterals. Over the same three months, more than $9 billion went back to shareholders through dividends and share repurchases, and net debt fell by more than $7 billion. A balance sheet that strengthens through an investment phase this heavy is the kind of property the Trefis High Quality Portfolio favors. Revenue Accelerated To 9.6% While The Margin Slipped That growing base is why the missing ratio matters. Revenue over the past twelve months is about $361 billion, up 9.6% year over year against a three-year average growth rate of 0.0%. Profitability went the other way: the trailing operating margin is 10.7% against a three-year average of 11.7%. Management called the quarter exceptional despite a Middle East disruption that temporarily cost roughly 10% of upstream production; that same disruption also pushed chemical product margins up about 180% from the first quarter of 2026. The trailing year, which still absorbs that one exceptional quarter, is closer to the run rate than Q2 alone; a return figure would tell a holder how close. Reassuring On Cash, Silent On Return None of this is evasion, and the quiet is not in itself a warning. Guyana's cost recovery genuinely converts entitlement volume into free cash flow, and management's stated focus is value rather than volume. But a holder who bought a compounding-returns story now owns a company reporting bigger dollar totals on a thinner trailing margin, and the measure that would settle it has left the front of the results. Watch whether the corporate plan update due at the end of 2026 puts a return-on-capital figure back beside that savings total. Meanwhile, the question worth asking is not how much cash the business threw off, but which companies actually earn a rising return on the capital they keep spending. Unanswered Questions Cost The Biggest Holders The Most When management leaves questions open, the uncertainty weighs heaviest on whoever owns the most of the stock. Concentration tends to arrive by accident rather than by decision. What your largest position would do to your net worth is exactly what the Trefis Wealth team computes, with the same rules-based systematic discipline that runs our High Quality Portfolio. Request a free vulnerability audit of your biggest positions.

Occidental Petroleum delivered a quarter that surpassed Wall Street’s expectations, with management attributing the strong performance to operational efficiency gains and disciplined cost control across its U.S. and international assets. CEO Richard Jackson cited the company’s ability to drive down principal debt and enhance production efficiency, particularly in the Permian Basin, as central to the results. Additionally, the midstream and marketing segment benefited from gas marketing optimization and stronger crude marketing margins, while ongoing cost savings initiatives further supported profitability. CFO Sunil Mathew emphasized that operational execution, including improved drilling efficiency and lower maintenance costs, played a key role in generating the company’s highest quarterly free cash flow since 2022. Is now the time to buy OXY? Find out in our full research report (it’s free). Revenue: $8.33 billion vs analyst estimates of $7.22 billion (57.1% year-on-year growth, 15.3% beat) Adjusted EPS: $2.40 vs analyst estimates of $1.86 (29% beat) Operating Margin: 46.7%, up from 15.8% in the same quarter last year Market Capitalization: $59.04 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Nitin Kumar (Mizuho): Asked about the pace and ratability of the cash flow improvement plan. CEO Richard Jackson and CFO Sunil Mathew explained that the plan is front-end loaded, with structural improvements providing durable gains and the timing of interest savings tied to debt reduction milestones. Douglas Leggate (Wolfe Research): Sought clarification on capital allocation priorities and sustaining capital reductions. Jackson and Mathew confirmed debt reduction remains the top priority, with dividend growth measured and share buybacks opportunistic until the preferred redemption in 2029. Jackson and SVP Ken Dillon detailed how waterflood and enhanced oil recovery projects are lowering decline rates. Neil Mehta (Goldman Sachs): Inquired about sustainable cost savings beyond interest expense and the role of Low Carbon Ventures (LCV). Jackson highlighted drilling and operational efficiencies, while Mathew pointed to further rig reductions and increased well output. Jackson noted LCV’s focus on carbon capture and its integration with core oil operations. Betty Jiang (Barclays): Questioned the path and pacing of sustaining capital reductions and the role of the Rockies asset. Mathew explained that a gradual step-down in capital is planned, aided by efficiency gains and lower well costs, while VP Babatunde Cole described the Powder River Basin as a growing contributor with improving margins and productivity. Arun Jayaram (JPMorgan): Asked about advanced recovery techniques in unconventional reservoirs and midstream/marketing expectations. Jackson reported strong recovery rate improvements from CO2 and surfactant applications, while Mathew described potential volatility in midstream results due to changing spreads and sulfur prices, but noted operational flexibility. In the coming quarters, our team will closely watch (1) the pace of debt reduction and progress toward the $10 billion principal debt milestone, (2) the effectiveness of cost savings and operational efficiency initiatives across U.S. and international assets, and (3) the execution of advanced recovery projects—particularly in the Permian and Gulf of America—that are expected to lower base decline rates and boost cash flow. The integration of carbon capture and technology partnerships will also be key areas to monitor. Occidental Petroleum currently trades at $59.02, up from $53.81 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members). ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time. Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

Diamondback Energy, Inc. FANG raised its 2026 production outlook after a second quarter that topped earnings expectations, while leaving its full-year capital budget unchanged. That combination puts capital efficiency at the center of the investment case. Higher volumes could extend earnings momentum if operating gains keep costs contained. The test is whether Diamondback can sustain the larger production base without requiring a proportional increase in spending. Diamondback increased 2026 oil production guidance to 522+ thousand barrels per day from 520+ thousand barrels per day. Total production guidance rose to 1,000+ thousand barrels of oil equivalent per day from 972+ thousand barrels of oil equivalent per day. Full-year cash capital expenditures remain about $3.9 billion. For the third quarter, FANG expects oil production of 517-527 thousand barrels per day, total production of 995-1,015 thousand barrels of oil equivalent per day and capital spending of $950 million to $1.05 billion. Image Source: Diamondback Energy Second-quarter production reached 1.018 million barrels of oil equivalent per day, including 525 thousand barrels of oil per day. Adjusted earnings were $6.48 per share, topping the Zacks Consensus Estimate of $5.96. Revenues of $5.6 billion increased more than 51% year over year and beat the consensus mark by about 17%. The earnings outperformance reflected production growth and a 53.1% year-over-year improvement in realized oil prices. Image Source: Diamondback Energy Diamondback has improved well construction, targeting, stimulation and completion techniques. Management noted that wells that once took about 30 days to drill can now be drilled in roughly five days, while longer laterals and lower costs per foot are supporting well economics. The focus is on combining more wells per section with higher production per well at a low cost per well. ConocoPhillips COP also continues to emphasize capital discipline, reaffirming its full-year 2026 guidance after the second quarter. Occidental Petroleum Corporation OXY reported second-quarter production above the high end of guidance while spending $1.6 billion on capital expenditures. Commodity sensitivity remains the biggest constraint. A sustained crude-price decline could pressure cash flow, drilling economics and the economics of carrying a higher production base. Service-cost inflation is another concern, particularly for casing, fuel and other consumables. Management estimates that maintaining the higher production base could require roughly $1 billion or slightly more of quarterly capital spending. Rising gas production adds another risk because Permian natural gas pricing can weaken when takeaway capacity is tight, limiting the benefit of stronger volumes. The higher guidance supports the case that Diamondback can preserve operating momentum without lifting its full-year capital budget. Still, the payoff depends on execution, commodity prices and the company’s ability to keep efficiency gains ahead of cost inflation. FANG currently carries a Zacks Rank #3 (Hold). It has a Growth Score of A, Momentum Score of A, Value Score of B and VGM Score of A. Those favorable Style Scores reflect attractive growth and momentum characteristics, while the Hold rank keeps the near-term view balanced as investors weigh commodity exposure, costs and execution risk. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Diamondback Energy, Inc. (FANG) : Free Stock Analysis Report ConocoPhillips (COP) : Free Stock Analysis Report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 1:00 p.m. ET Vice President of Investor Relations - Babatunde Cole President and Chief Executive Officer - Richard Jackson Senior Vice President and Chief Financial Officer - Sunil Mathew Senior Vice President and President, International Oil and Gas Operations - Ken Dillon Operator: Good afternoon, and welcome to Occidental's Second Quarter 2026 Earnings Conference Call. Please note, this event is being recorded. I would now like to turn the conference over to Babatunde Cole, Vice President of Investor Relations. Please go ahead. Babatunde Cole: All right. Thank you, Gary, and good afternoon, everyone, and thank you for participating in Occidental's Second Quarter 2026 Earnings Conference Call. On the call with us today are Richard Jackson, President and Chief Executive Officer; Sunil Mathew, Senior Vice President and Chief Financial Officer; and Ken Dillon, Senior Vice President and President, International Oil and Gas Operations. This afternoon, we will refer to slides available on the Investors section of our website. The presentation includes a cautionary statement on Slide 2 regarding forward-looking statements that will be made on this call this afternoon. We'll also reference a few non-GAAP financial measures today. Reconciliations to the nearest corresponding GAAP measure can be found in the schedules to our earnings release and on our website. I will now turn the call over to Richard. Richard Jackson: Okay. Thank you, Babatunde, and thank you all for joining us today. Last quarter, as I started into my new role, I shared our focus looking forward was on execution and delivery from our advantaged resource position. The last few months have been productive, and we continue to deliver strong 2026 results. We were also able to advance our plans for sustainable cash flow growth, and I look forward to sharing updates on both with you today. To start, I want to frame simply how we think about our approach to value. For us, creating value is measured by our ability to increase both the return on and the return of capital through the cycle. To ensure we are centered on fundamentals to deliver this value, we are focused on four priorities: executing from a strong balance sheet, organically improving our resources, continuing to drive cost efficiencies and generating differentiated cash flow. This year, we are making strong progress on each. We have already reduced our principal debt to $11.8 billion. Our accelerated debt reduction lowers our go-forward annualized interest by approximately $630 million compared to 2025 interest payments. This structural savings helped enable an additional 8% increase to the quarterly dividend this year as approved by our Board and announced yesterday. We also remain on track with our 2026 cost savings targets, while operational efficiencies delivered another production beat in the second quarter. Taken together, we expect to deliver more than the targeted $1.2 billion of free cash flow improvement for this year before the impact of higher oil prices. Looking ahead, we see a clear pathway to add over $4 billion of annual sustainable cash flow by 2030. This represents an approximate 95% annualized growth compared to 2025. Importantly, this increase is driven by durable improvements across the business, including lower cost, lower sustaining capital and a stronger balance sheet. Additionally, we can deliver this cash flow without increasing production and can expect approximately 85% to be achieved at even much lower prices. While production growth is not required, our quality resources and execution efficiency provide opportunities for measured growth that could further improve cash flow. Our ability to deliver on this plan is grounded in organic development. We believe our advantaged resources, advanced resource recovery capability and a value-based development approach are three areas that provide a differentiated capability to achieve our value plans. Today, our resources totaled 16.5 billion BOE and are well understood and balanced, providing more than a 30-year low-cost development runway across conventional and unconventional assets. Approximately 88% of our resources are domestic and are complemented by a select set of international assets with strong partnerships, resilient free cash flow and future upside opportunities. Advanced recovery is another area that plays a central role in our plans. Over the last few years, Oxy has continued to build a differentiated capability to improve resource recovery and unlock more value from the subsurface with demonstrated results. Today, we're applying those capabilities across conventional and unconventional assets to support additional low-cost resource recovery and lower future decline rates. In our plans, we are advancing opportunities across unconventional, enhanced oil recovery and Gulf of America waterflood developments and in exploration opportunities where our advanced recovery capabilities can add value. As important as our approach to development, we have continued to refine our integrated value-based approach that combines subsurface characterization, technology, infrastructure and operational considerations into long-term field development plans. By combining these important elements, we're able to optimize designs and sequencings to improve recovery and full cycle returns. Our approach is unique by basin, asset area and often individual well, which has led to our top-tier capital efficiency in our U.S. unconventional developments. And we see similar improvements with this approach across all of our operations. Additionally, we seek to integrate advancing technologies and partnerships around our key areas of CO2, power, water and AI to further improve our results. Together, these advantages position us well to deliver our $4 billion in incremental sustainable cash flow by 2030. As we look to the future, we believe these will further differentiate our ability to drive value. Now to go further into the specifics of our sustainable cash flow growth. We note four areas of improvement with several milestones to mark our progress. First, we will continue to improve capital efficiency and reduce costs across the business. Over the last several years, our teams have consistently reduced costs to deliver more than $2 billion in savings since 2023. We are on track for this year's targets and expect to further extend our savings by 2030. We have clear initiatives underway with new milestones, including U.S. onshore new well cost reductions, lower domestic LOE and transportation costs and improving workforce efficiency through simplification and technology deployment. Second, we expect lower sustaining capital by $900 million through continued improvements in capital efficiency and from a lower total Oxy base decline. This base decline improvement is driven by our advanced recovery projects, which are expected to support a decline rate reduction from approximately 25% to 20% by 2030. Third, we will continue to see the benefit from corporate savings as we further strengthen the balance sheet. Continued debt reduction is expected to lower principal debt to a $10 billion milestone and reduce annual interest expense by roughly $740 million compared to last year. Additional savings from the redemption of our preferred equity also contribute to our corporate savings milestone. Finally, we will see a reduction in Low Carbon Ventures capital spending. With Stratos moving from development to operations, approximately $400 million of LCV capital will fully roll off beginning next year. At Stratos, we're making good progress on the nontechnology-related repair and commissioning of Trains 3 and 4. Based on our current outlook, we expect full plant commissioning to begin around the end of the year as we transition to operations in 2027. Altogether, our team has done an outstanding job building our sustainable cash flow improvement plan. They have taken a bottoms-up approach, identifying and now executing many detailed projects and initiatives to drive our organic improvement. We see this as a new baseline with opportunities to add and accelerate value as we go beyond our milestones. Additionally, continued portfolio optimization, measured and efficiency-led growth and stronger oil and gas prices can all further increase our cash flow beyond the baseline that we are sharing today. In addition to our significant cash flow inflection, we know it's important to execute from clear and disciplined allocation priorities. We recognize market and operational conditions will continue to evolve and believe these priorities with the right considerations enable us to improve value through cycles. We begin with a clear set of foundational priorities that are designed to support a stronger business and return of capital capability. Beyond that, we have subsequent opportunities to further add value. These include debt reduction, the redemption of our preferred equity, opportunistic share repurchases and disciplined investment and opportunities that can improve sustainable cash flow and returns. As we consider future reinvestment for growth, we appreciate we have a deep inventory of advantaged, well-understood resources for low-cost development. However, when we invest for growth, we want to be thoughtful. Simply put, it must be measured, efficiency-led and clearly value additive. There are multiple considerations to help guide our decisions to deliver and improve our baseline plans. Ultimately, our plans are set to build a fundamentally stronger business where we can sustain production at lower oil prices with a sustainable and growing dividend. At higher prices, we have opportunities to add further value, both for the business and our shareholders. I'll now turn briefly to second quarter highlights. Our teams have delivered another strong quarter operationally and financially. Production exceeded the high end of guidance, reflecting strong operational performance across our assets. In midstream and marketing, adjusted pretax income exceeded the segment's previous record performance. We also generated approximately $3 billion of free cash flow during the quarter, our highest level since the third quarter of 2022. Across the business, execution remains strong to deliver in 2026 and to progress our new plans. Through a relentless focus on efficiency, we're continuing to outperform. The consistency of these results continue to reflect the quality of our team and the strength of our assets. I'll now turn the call over to Sunil to discuss the financials. Sunil Mathew: Thank you, Richard. In the second quarter, we generated adjusted earnings of $2.40 per diluted share and reported earnings of $2.75 per diluted share. The difference was largely driven by mark-to-market gains in marketing and crude hedges along with a dilution gain in equity investment income. Strong operational execution and cost discipline, combined with higher commodity prices resulted in approximately $3 billion of free cash flow before working capital. This is our highest quarterly free cash flow since the third quarter of 2022, which included OxyChem. We ended the quarter with approximately $4.2 billion of unrestricted cash, giving us additional flexibility as we continue to advance our cash flow priorities. As Richard discussed, Oxy continued its track record of strong operational performance. Total production for the quarter averaged 1.43 million BOE per day, exceeding the midpoint of guidance by 23,000 BOE per day. Domestic outperformance was driven by strong base and new well performance in the Permian and higher uptime in the Gulf of America, which more than offset lower international volumes due to Middle East disruptions. We also continue to execute on our cost efficiency targets. Domestic lease operating expense was $7.80 per BOE, a 6% improvement versus guidance, supported by higher production across our domestic assets and maintenance schedule optimization in the Gulf of America. Midstream and marketing outperformed in the quarter, setting a new quarterly record with adjusted earnings of approximately $960 million, which was more than double the midpoint of guidance. This was driven by gas marketing optimization, stronger crude marketing margins due to timing of cargo sales and fluctuations in commodity prices and higher sulfur prices at Al Hosn, partially offset by lower sulfur sales. These results demonstrate the value of our midstream portfolio and capabilities, particularly in periods of price volatility. Next, let's turn to the balance sheet. We have continued to make significant progress on deleveraging. Since our last call, we reduced principal debt by $1.5 billion to $11.8 billion, the lowest level since the second quarter of 2019. This brings our go-forward annual interest run rate to approximately $760 million, which is approximately $630 million lower than our interest payment in 2025. Net principal debt is now $7.6 billion, reflecting the $4.2 billion of cash we have built. This progress highlights the strength and durability of our free cash flow and our continued commitment to disciplined capital allocation. Near-term debt maturities remain low with only $414 million due through the end of 2029. This provides meaningful support through periods of market volatility and gives us flexibility as we continue to strengthen the balance sheet and prepare for the preferred redemption in 2029. Our continued progress on deleveraging and structural cost improvements has strengthened the balance sheet and improved financial flexibility, supporting the Board's approval to raise the quarterly dividend by 8% to $0.28 per share. As previously shared, our immediate cash flow priority remains to reduce principal debt to $10 billion. After we achieved the $10 billion principal debt milestone, our focus will be to further reduce net debt. We will balance additional principal debt reduction with building cash ahead of the preferred equity redemption in August 2029, taking into account the macro environment. Share repurchase actions will remain opportunistic and any continuous share buyback program will be a lower priority until the redemption of the preferred. Any increase in reinvestment would be measured and efficiency led, supported by clear macro conditions. Richard spoke earlier about the work underway to improve cash flow and the sustainability of that progress. By 2030, we expect to deliver $4 billion of annual sustainable cash flow improvement relative to 2025. In oil and gas, this will be driven primarily by cost efficiencies and reduced sustaining capital resulting from a lower decline rate. The oil and gas efficiencies targeted beyond 2026 largely reflect our ongoing expansion of cost savings initiatives. The remaining cash flow improvement will come from midstream savings, a reduction in LCV capital and corporate cost savings. These are largely structural improvements across the business that should expand margins, strengthen resilience and further differentiate Oxy's ability to generate durable leading cash flow over time. Importantly, approximately 85% of the improvements are expected to be delivered even at lower prices, reflecting the durability of the underlying operational improvements rather than reliance on higher oil prices. Turning to guidance. We expect the second half of the year to reflect continued operational momentum. For the third quarter, we expect production to range between 1.4 million and 1.44 million BOE per day, supported by the strength of our U.S. onshore program and continued execution across the portfolio. In the Permian, production is expected to increase adjusted for a nonrecurring second quarter production uplift, supported by higher activity and resilient base performance. In the Rockies, third quarter volumes are expected to decline as a result of activity timing. And in the Gulf of America, a planned shift in maintenance timing, along with the weather contingency is expected to impact third quarter production. Internationally, we anticipate normalized volumes while recognizing the situation in the Middle East is fluid. For the full year, we are raising total company production guidance. A stronger outlook for new well and base performance across our domestic assets is expected to offset marginally lower international volumes. For domestic lease operating expense, we expect third quarter cost to be $8.75 per BOE, reflecting the planned shift in maintenance activity and weather contingency in the Gulf of America. For the full year, we are maintaining domestic lease operating expense guidance of $8.10 per BOE with efficiency gains and disciplined cost management, helping to offset increasing CO2 cost pressure related to higher oil prices. In midstream and marketing, we expect third quarter income to decline as the Waha to Gulf Coast natural gas spread narrows. While the narrowing spread reduces midstream income, the impact is expected to be largely offset by stronger upstream gas realizations. Given the segment's strong year-to-date performance, we have increased full year guidance by $300 million. We remain well positioned to capture commercial opportunities as market conditions develop. On capital, the program remains aligned with our full year plan with weighting towards the first half of the year. We are maintaining our full year capital guidance range of $5.5 billion to $5.9 billion. Looking to 2027, as we mentioned in the previous calls, our starting point for capital spending is expected to be $5.9 billion. That level includes mid-cycle projects that help reduce base decline and sustaining capital over time. At that level of investment, you can assume relatively flat production in line with 2026. In summary, we believe Oxy remains extremely well positioned to deliver durable value and through-the-cycle returns. In a highly dynamic macro environment, our outlook is supported by a stronger balance sheet, a more efficient cost structure and a portfolio that gives us flexibility across price environments. Our U.S. onshore assets provide short-cycle optionality, while our lower decline mid-cycle investments in the rest of our portfolio support cash flow durability over time. We will continue to allocate capital with discipline, prioritize debt reduction and preserve the ability to return additional capital as we make progress on our cash flow priorities. I will now turn the call back over to Richard. Richard Jackson: Thank you, Sunil. Before we open it up for questions, I'd like to thank our employees around the world for their dedication and their commitment to excellence. Special thanks to our Middle East teams and our partners for their resilience and teamwork as we continue to support each other across the region. The work we're doing across the business is making Oxy stronger. The benefits of a stronger balance sheet, improving cost efficiency and lowering sustaining capital continue to build a significant value inflection ahead of us. I'm encouraged by the progress we've made and believe our best results lie ahead as we execute our plans. With that, let's open it up for questions. And as a reminder, we have Ken and Babatunde here with us today for Q&A. Operator: We'll now begin the question-and-answer session. Please limit questions to one primary question and one follow up. If you have further questions you may re-enter the question queue. The first question comes from Nitin Kumar with Mizuho. Nitin Kumar: Certainly, a big day for Oxy with this cash flow improvement plan. I want to focus on Slide 6 and two aspects. First, could you talk through the ratability and progression of the cash flow inflection? Some of the initiatives that you mentioned are already in flight. So just wondering how we should think about how quickly you could get to the end goal. And then the second piece was just you briefly mentioned the oil and gas efficiencies, but if you could maybe unpack that a little bit more. Richard Jackson: Yes. I appreciate the question. I'm going to start to just frame a little bit and then Sunil is prepared to go into some of the details and timing as this -- I know that's important. I think I just wanted to say in the top, this -- the way we're looking at it, the sustainable cash flow, we think it's important. It really drives the fundamentals of the business. If you think about the levers we have, you increase cash from operations, driving the cost efficiency, the productivity of what we do and then really then the focus on the sustaining capital, both from a new well cost and then as we're highlighting and believe not only our assets, but our capabilities drive those advanced recovery, that really delivers the available cash to then couple with good cash flow priorities to drive value. So -- but as we think about it going forward, we feel like this is a durable framework that we continue. Hopefully, we're being clear in terms of the cash flow priorities. But as Sunil said, it really is focused for through the cycle. This capability really drives sustainable production dividend, which we were able to make this increase this quarter. And at higher prices, it's being thoughtful about where we allocate the cash. Maybe the last point I'll say before we get to the timing is just we recognize too, a bit of this is free cash flow focused. We are able to make these incremental mid-cycle, low-decline investments, but this preference towards allocating cash to net debt was an important thing to get out. And so again, driven by structural improvements, driven by things like oil and gas efficiencies and the teams are really lined up to get behind it and drive these results. But turn it over to timing for Sunil. Sunil Mathew: Thanks, Richard. Nitin, so in terms of timing, as Richard said, we are currently on track to achieve the greater than $1.2 billion of cash flow improvement in 2026 relative to 2025, which we had outlined earlier this year. Now looking at 2027 sustainable cash flow improvement relative to 2026, a couple of items to highlight. One is on the midstream side, there is the roll-off of Stratos capital. That's around $200 million. And then on the corporate side, it's mostly around interest expense savings. So once we get our principal debt down to $10 billion, our go-forward interest rate is approximately around $650 million. And so from an interest savings point of view relative to 2025, that's around $740 million, of which we expect to recognize around $400 million in 2025 and the additional $340 million in 2020 -- sorry, the $400 million in 2026 and the remaining $340 million in 2027. So that is purely a function of timing as to when we do the debt repayments. But the other thing I want to also mention is we have assumed a $10 billion principal to debt is just a milestone. And that's what we've assumed in terms of the expected interest savings for this cash flow improvement. But we are likely to lean towards more principal debt reduction if the macro is supportive to reduce that net debt. And then talking about oil and gas, like Richard said, it's largely a continuation of our operating efficiencies we have seen in 2026, both on the CapEx and OpEx side. The teams are still working through the 2027 plan and incorporating some of the expected benefits. So I don't have a -- I cannot give a specific number at this point. But considering the roll-off of LCV capital, the expected interest savings once we get our principal debt down to $10 billion and some of the expected oil and gas savings, you can think -- it's going to be around $700 million to $800 million in 2027 relative to 2026. So, between '26 and '27, it's going to be around $2 billion, which is approximately or close to 50% of the $4 billion savings. And as you think beyond 2027, there is $700 million of the preferred redemption in August 2029, and that leaves around $1.3 billion, which we expect to achieve between '28 and '29. Nitin Kumar: Great. So it sounds like it's a pretty ratable program, perhaps a little bit front-end loaded if you take out the preferred redemption. As my follow-up, I just want to -- I like the term efficiency-led growth that you and Richard mentioned. Could you help us unpack that a little bit? The macro environment is obviously very supportive right now. And with this improved cash flow, you have a better ability to lean into growth. How are you thinking about growth right now for '27 and maybe longer term? Richard Jackson: Yes. No, I appreciate that follow-up. Again, a bit biased to free cash flow in the near term just to achieve -- feel like that allocation gives us the most direct path to value. But efficiency-led growth means a few things. I mean, one, we continue to drive efficiency this year in terms of outperforming. We were -- in the U.S., our production has fully offset the disruptions of our production in the Middle East. And so we want to continue to challenge our teams to do that. And then we wanted to list considerations on that Slide 6, too. Just think through a few things. I mean, clearly, returns, you got to start there if you think about reinvestment. But things like cost efficiency, we want to continue to see the cost efficiency that we've seen and that we're now outlooking. And so we'll be thoughtful that any additional activity changes, whether that's growth or not, is maintaining that capital efficiency. The free cash flow timing is important, especially in the near term. So as we think about constructing the short cycle and mid-cycle projects, we want to see those work together. Decline rate is important. And so again, the timing of the cash flow also comes with the decline rate. And so balancing that so that we're hitting that milestone important. We continue to advance technology, things like our unconventional EOR. So you want to time those sort of investments to fit that. And then just macro, looking -- obviously, got a lot of volatility at the moment and making sure, especially as we're making more mid-cycle type investments, we want to be very thoughtful that we have a firm understanding of what those scenarios look like. So all of those mean something. We've also run internal scenarios and maybe Sunil can provide a little color there. Sunil Mathew: Yes. I mean as Richard mentioned in his prepared remarks, this was a true bottoms-up submission in terms of our long-term plan. And we looked at multiple scenarios. What we've outlined today is sort of a sustaining CapEx scenario, which is without any production growth. But we also looked at a moderate growth scenario where looking at a production CAGR of around 2%. And what we saw was with the balanced investment between short-cycle and mid-cycle investments, our free cash flow improvement is actually better than what we have outlined today by the time we got to 2030. So like Richard said, this is our baseline plan, and we're looking at options as to how we can accelerate and improve on our baseline plan. Operator: The next question is from Doug Leggate with Wolfe Research. Douglas George Blyth Leggate: Richard, you and Sunil have worked together for a very, very long time. It's really fascinating to see what you've come up with as a leadership team here. And I've got two specific questions, if I may. The first one is Sunil made a very clear statement, I think, that buybacks will take a secondary place to the preferred redemption. The implication then is that your net debt will continue to drop, you'll have to build cash to redeem the pref. Is that the right interpretation of that comment is my first question. And then my second question, if I may, is a big part of your free cash flow inflection aside from the pref is the decline in sustaining capital. I just wonder if you could walk through some of the moving parts. I'm thinking, obviously, you've got steam flood, you've got the EOR, but you've also got the CO2 huff and puff in the unconventional. Just walk us through how you get that sustaining capital down as low as you're planning. Richard Jackson: Great. I'm going to start briefly because I think we may share this answer. And yes, it is good work with Sunil for a long time. But certainly, from a cash flow priority, I think you're seeing it right, preferences, net debt. Again, I feel like at this time, that allocation provides the clearest path to increase value. We're excited about the sustainable cash flow. We think it's a tremendous inflection in terms of value for Oxy, but we want to be smart in terms of how we progress that. Decline rate is a part of it, and we are -- as we've restored balance sheet, been able to make some of these incremental investments in the projects you're describing. But let me talk -- flip it to Sunil, and then we'll combine on some of these projects that are making that up. Sunil Mathew: Doug, let me just get into a bit more detail in terms of how we are thinking about cash flow priorities. So, as we said, one of our foundational cash flow priorities is to have a sustainable and growing dividend. So it starts with having a strong balance sheet. Our principal debt is currently at around $11.8 billion, which is the lowest we've had since second quarter of 2019, and we are well on track to achieve the $10 billion principal debt milestone. In terms of leverage metrics, last year, our debt-to-EBITDA based on the actual price of $65 WTI was around 1.9. And once we get our principal debt down to $10 billion, our debt-to-EBITDA normalized for $65 WTI is almost going to be half of that. So then the question is what next? And like I mentioned in my prepared remarks, once we get to the $10 billion principal debt, we will -- our focus is to further reduce net debt. We will balance the additional principal debt reduction and building cash based on the macro and the timing related to the preferred redemption in August 2029. But like I mentioned earlier, we are likely to lean towards more principal debt reduction if the macro is supportive. But considering the current volatility in oil prices, we do not want to give a new milestone at this point. And share repurchases will be opportunistic, like you said, and you highlighted, any large continuous share repurchase program will be lower priority until the redemption of the preferred in August 29. So, in terms of dividend, we announced an 8% dividend increase this quarter, and we will be measured in terms of how we think about dividend growth, ensuring that we can support it through the cycle through a combination of strong balance sheet and increasing sustainable cash flow. So the progress on both of these will determine how we think about dividend growth. And accordingly, we will recommend to our Board. So this -- I think, hopefully, this will provide more color and clarity around how we think about cash flow priorities. Richard Jackson: Yes. Maybe real quick, Ken and I can -- just a couple of notes on the decline rate. You want to start, Ken? Kenneth Dillon: Yes. Afternoon, Doug. As you know, Oxy is an industry leader in water flooding. We injected water prior to CO2 in all the large Permian EOR fields, also internationally with great success right through to today in Oman, where we use it to reduce declines from 19% to around 7% once complete, extending field lives. Typically, water flooding can add more than 15% oil in place in fields that you already operate with very low F&D. We're now applying these technologies to Goa. On Mountain waterflood remains on track for injection in the second half of next year '28. Marlin King water dump flood was completed in the last quarter and is already on stream. We would expect a response in Q1 next year. And longer term, we completed our CO2 EOR pilot in Oman, and that's been successful. Richard Jackson: Yes. So the only thing I would add is I think in total, the waterfloods in Gulf of America, obviously, progress in our EOR projects, certainly in the Permian, but even globally, will contribute. The other thing I'd just quickly say, base performance. I think we've continued to beat on base performance, uptime record. So that's been a big piece of it. Then the last thing, and this was really an acceleration, but it's a great project we're looking forward to sharing more with. On the Central Basin platform and our EOR assets, we've been able to deploy some workover rigs to do sidetracks in some of our tighter conventional rock using all the things that we've learned through unconventional being able to do some fracs there, we're seeing great results. And so that's been good kind of low-cost adds for production this year. But what that also does is derisk quite a few opportunities on the Central Basin platform. And you can think about it similar to kind of Midland Basin shallow wells or more conventional Midland Basin at similar cost. So we're excited about that opportunity, but those come at a lower decline rate too, especially when we put CO2 to it where we can increase the recovery and lower the decline. So just wanted to get that in there as well. Operator: The next question is from Neil Mehta with Goldman Sachs. Neil Mehta: Really great disclosure, Richard. First question is just on sustainable cost savings beyond reduction in interest expenses. Can you talk about how you're going to approach taking cost out of the business in a way that is sustainable. Richard Jackson: Yes. I appreciate that. I mean that is a really important aspect of what we're trying to do here. The teams, like I said, we'd like to highlight the track record, but more to go. And so as Sunil said, some things continue from this year to next. Our drilling efficiency continues to get better. We're almost 50% better in terms of well delivery per rig. I think we showed some rig reductions in the Permian as a reflection of that efficiency. Simulfrac continues to expand. I think we've increased the outlook on that. So some of these things are what we've been talking about. I'd say the upside, so this is one we could go further at Ken and I and Sunil and our team are really working to take a global perspective in terms of cost and efficiency. We do a great job across our assets, but we feel like there are some areas that we can continue to scale, work together. And so while we highlight the U.S. well cost and even the domestic LOE, we think there's opportunity beyond that. So I'm really excited about that to get back to working with the teams on that sort of thing. The other thing, just lastly, we want to be intentional with our work choice milestone. This is the baseline. The teams are obviously working hard to deliver more. And so while this is a start, we're going to be working all options to accelerate value. I think Sunil had one to add. Sunil Mathew: Yes, just want to -- Richard mentioned about the efficiency and we have seen so far in '26. So a data point around that based on the efficiencies we have seen so far in Permian, the plan is to drop three rigs in Q4. And -- but we're actually expecting to have 15 more wells online in Permian. And from a production point of view, once we adjust for the transaction we did in Permian EOR, the full year guidance is actually 7,000 more than the original guidance that we had given in the first -- the fourth quarter call. So it again comes back to doing more with less. So this is just another indication of the continued and the relentless focus on operating efficiency. Neil Mehta: And then the follow-up is just on LCV. And how does it fit in the multiyear plan? Obviously, Stratus has been a little choppy in the start-up. But as you think of -- and the market conditions are changing, but it's very interesting technology. So just how does it fit into the go-forward strategy? Richard Jackson: Yes. CCUS, I'm going to broaden it a little bit just to kind of talk through carbon capture technologies still add value as we look forward or can add value. We've made significant progress for us within LCV advancing several of these technologies, including DAC. The core purpose was focused on CO2, power and emissions. And those are really how you add value to our core business. We're seeing emerging opportunities in that today in the Permian. As you think about power generation, data center build-out, one outcome is the ability to capture CO2 off of those facilities. And so we're excited and have positioned ourselves, I think, to do that. And so CO2 and power are 30% of the operating cost of an EOR barrel. And so when we look forward, and we're excited about the economics and from a corporate perspective, what things like lower decline do for us, but we do want to address that supply and the cost and carbon capture can play a role. But where we stand today, we felt like we're at meaningful milestone. DACs coming online as we look forward, the other projects and technologies that we've been working with are at similar milestones. And so we're really at a point where partners in the market need to help pull us forward. And that's been our plan. And so the teams are very focused to make that happen. But with success as development goes forward, we really will be focused on bringing in partners to help us move that forward. So I appreciate the question. Team is working hard on DAC. I know we'll have more updates as we go, but appreciate the opportunity to address that. Operator: The next question is from Betty Jiang with Barclays. Wei Jiang: I want to ask about CapEx again. When I look at the sustaining CapEx that's going from $5.4 billion to $4.5 billion, it seems clear based on your comments so far that it will be a pretty gradual step down over the next few years. And then if I compare that $4.5 billion at the endpoint from like the $5.9 billion that you're saying for next year, that's at the top, that's a big range. on how much CapEx can come down. So my question is, what's the quantum of growth capital that you're willing to spend above and beyond the sustaining capital, assuming a mid-cycle price environment, maybe just how you're pacing this investment in both short cycle and longer cycle projects. Sunil Mathew: Betty, so let's talk about the 2027 CapEx. Like I mentioned, our starting point is $5.9 billion. And the way we define sustaining capital, it excludes multiyear projects, exploration and the growth projects. So for next year, if you back out exploration, we back out the waterflood project in Gulf of America, we're going to see the peak spending related to the Horn Mountain project next year. And also in terms of EOR spending in Permian and some additional spending in international, you're looking at a sustaining capital of around $5 billion to $5.1 billion next year. So what we are doing is we are continuing to invest in mid-cycle projects that is going to help with our base decline and ultimately reduce our sustaining capital. So as you take it forward to 2030, this is what is going to help us to get to that $4.5 billion. It's a combination of lower decline that helps reduce our sustaining capital. And then we are also expecting more in terms of well cost efficiency improvement. We have said we are targeting 12% by 2030. This year alone, we are at 7%. So it's a combination of these two that's going to get us to the $4.5 billion of sustaining capital in 2030. Richard Jackson: Yes. And maybe the only thing to add, I mean, like Sunil said, we've looked at even outlook with that sort of reinvestment. Our free cash at the end with reinvestment exceeds the $4 billion that we're talking about from a sustainable cash flow. So while we think it's important to think about it in the sustainable cash flow lens, the free cash flow outlook needs to improve over time to support that. Wei Jiang: Got it. No, that's helpful. My follow-up is on operations on the Rockies asset. It's always one that's a bit difficult to project and a lot of moving pieces. This year, you're investing more in the PRB, which is oilier and I think the program might envision more PRB investment going forward as well. Can you just talk through sort of cadence for the Rockies and just how you think about Rockies contributing within this longer-term framework? Babatunde Cole: Betty, it's Babatunde. Great question on the Powder River. So I think the Powder in general is becoming a lot more important to our U.S. oil growth story, right? So what we're seeing is a result of just not just strong asset quality, but also quality execution improvements by our teams. So the benefits we're seeing are stronger well performance, continued development of our oily basin position in the basin, but also the same operational efficiencies that Sunil mentioned, we're achieving across these assets also. So just a couple of things to point out on the Powder River Basin. From a well productivity standpoint, we're about 41% above the industry average using a 6-month oil productivity basis. Well cost is down about 10% this year. We're expecting to be down about 10% this year. So it is benefiting from the same improvements we're seeing across all our other basins. So I think from a cadence standpoint, what you're seeing is the DJ Basin activity moderate a little bit and the Powder River activity shifting into the Powder River. So from a margin standpoint, we're getting oilier, and we're replacing that with some higher-margin production. So we'll disclose more as we move through our cash flow improvement plan, but this is one of the examples of the higher-margin additions that we plan to make as we move through the cash flow framework. Operator: The next question is from Arun Jayaram with JPMorgan. Arun Jayaram: Richard, I was wondering if you could comment on the application of these advanced recovery techniques in unconventional reservoirs. How -- maybe describe how Oxy is applying it to shale, what you're seeing from a resource recovery standpoint? And how is this helping to mitigate your decline rate? Richard Jackson: Yes. I appreciate that question. We obviously have a long history with CO2 EOR and conventional reservoirs. And we've had these pilots now ongoing in the Permian, both Midland and Delaware Basin for 10 years. And while different, the results have been similar. We've seen consistent more than 45% uplift in terms of EUR. So if you're thinking about 10% average recovery in an unconventional well, now you're talking getting up to 15%. We think ultimately, as we continue to cycle CO2, that can get up to 20%. And so we're doing a lot of things. The industry, I think we're all working on different technologies to help support increased EUR. We're seeing strong results in surfactants and other things. I would say two things that maybe make us a little bit different. One, we're very customized in the way we approach this. So all these techniques are a bit different by basin. Two, we are thinking EOR. So even in surfactant, things like surfactant and CO2 can work together to further improve the results. And so for us, this is a growing story. I think the Central Basin Platform horizontals that are tight conventional are an early opportunity to think about how do these reservoirs perform. But then as we go into the end of this decade and certainly into next, we've got these commercial projects. We've got three that are underway. They'll come online later '28, '29. We'll start to see those benefits in the decline rate. And then at our option, we're able to then continue to develop those into the next decade. So I appreciate that question. I think that really does differentiate our position, differentiates our focus. And again, we talk about things we do all over the world, but that's a really meaningful one as we think about the next decade. Arun Jayaram: Great. My follow-up is maybe for Sunil. Sunil, can you talk about some of the puts and takes around the midstream and marketing expectations for second half? Obviously, that's been a key driver of upside on a year-to-date basis. But how do you see that evolving? And perhaps you can give your views on sulfur pricing in Al Hosn, the gas optimization with Waha now getting a little bit better and just thoughts on crude marketing. Sunil Mathew: Arun, so if you look at our -- what we've assumed for our third quarter guidance, the biggest change, as you've mentioned, is on the gas marketing side. We have seen a significant narrowing of the spread between Waha and Gulf Coast with additional Permian takeaway capacity now coming online. But like I mentioned in my prepared remarks, we expect the impact of the narrower spread on the midstream income to be largely offset by upstream with the domestic income with the Permian gas price realization improvement. And just a data point on that, with the larger Waha to Gulf Coast spread in Q2, our upstream domestic realized gas price in Q2 was around $2.50 worse than the first quarter. I mean, I think in the second quarter, our realized gas price was negative $1.50. So it was almost a $2.50 swing compared to the first quarter. And what we see is with the spread normalizing, we should see the domestic upstream realized gas price also to normalize. And then with respect to Al Hosn and sulfur, what we have assumed is we have definitely seen the spot prices move higher in the third quarter. but sulfur from the Middle East is largely exported and the region actually supplies almost half of the global seaborne exports. So considering the situation, the current situation in the Middle East, we see a significant volatility with respect to freight costs, and that could potentially impact our third quarter realization and also some potential delay or disruption to our sales. So we have incorporated some of these factors into the third quarter guidance. And what I would say is with respect to the second half compared to what we thought where we would be when we provided the guidance in the last quarter, that the spread has actually become even more narrower because there's almost 3 Bcf of capacity that has already come online and potentially another 2 Bcf coming online by the end of the fourth quarter. So with the capacity utilization coming in below 100%, even if there were some planned outages, we're not going to see the same kind of dislocation that we have seen in the last couple of quarters. You could see it for a short period, but we don't believe it's going to sustain for a long time. Operator: The next question is from Sam Margolin with Wells Fargo. Sam Margolin: Yes. Maybe just a follow-up on midstream because even though your gas position is kind of spread dependent in that business, obviously, you're very well positioned just given the upside potential that, that segment has in any given quarter, right? You're strategically very well positioned. So do you think there's an opportunity to maybe rebase that business in any way, just given what's going on with in-basin gas demand? In the Permian, what we're hearing about local sinks and just by virtue of the fact of where your assets are located, they seem to be in a good place. Richard Jackson: Yes. I think a couple of points. I agree. I think we've been well positioned in our midstream investments that we've had over time and then even these contracts have played out well for us. I think the main purpose for midstream for us is to ensure delivery of our product. We've had some upside where we can market beyond our equity. But I think we'll continue to look at the landscape you described, participate, but the real purpose is to really deliver the value, and I think we'll stay centered on that, especially within our kind of capital allocation priorities. Sam Margolin: Understood. Okay. And then maybe sticking with the Permian. The year started with a pretty significant change in your development model in the asset. But I'm looking at Slide 27, you've maintained all of your leadership in terms of well performance and productivity. Can you just talk a little bit about how you've managed to kind of make this change and focus on different zones while still sort of sustaining all those productivity goals that you had in the past? Richard Jackson: Yes. No, I appreciate that. The well productivity is core to what we do. You can talk about advanced recovery, it starts with unconventional wells continuing to perform. We have a great set of primary benches that play out for a long time. And so the focus of doing that continues. Our well performance has continued to be steady even and improve. We look at it both against ourselves and against our peers, and I think we do well in every basin that we operate. We do try to derisk secondary benches as we proceed in our development. And so -- and that's back to the second point I mentioned today around development efficiency, being able to refill that midstream infrastructure, being able to take advantage of development areas, that's the most capital-efficient way to approach development. And so we point to a lot of capital intensity number. So if you think about decline rate, now you've got to replace barrels, what is the cost. And so we look at how many millions of dollars per thousands of BOE that you've got to do to replace that. And for us, in the U.S. onshore, it's been less than 20 for quite a few years, which is we look at it as the right measure to think about how to do that efficiently. So Babatunde may have a couple of other kind of highlights on some of the recent developments. Babatunde Cole: Yes, definitely. Yes. Thanks, Sam. Yes. No, we're seeing strong repeatable well performance across multiple areas. And really, that's what gives us confidence to expand to where we are today. So I guess a couple of supporting proof points. When you look at the Delaware specifically, our secondary bench development, we're about 40% higher than the industry average 2024 to 2026. So a lot of that is due to just the work the teams are doing on the subsurface, how do we identify these high-quality targets, how do we frac it -- similar on the six-month oil stat we're about 21% higher than the industry benchmark. So we've increased our second bench development activity in the Delaware from about less than 10 to mid-40s so far. And it just really gives us confidence. It's a part of our long-term growth framework and this cash flow framework, and we've been able to derisk those -- that inventory and provide that growing confidence in the performance go forward. Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Richard Jackson for any closing remarks. Richard Jackson: Yes. Just thank you all for your questions today. I really appreciate the opportunity to walk through this new disclosure with you. We're very excited about the delivery opportunity. We look forward to sharing more with you as we progress. And thank you, and have a great day. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Before you buy stock in Occidental Petroleum, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Occidental Petroleum wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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Interested in Occidental Petroleum Corporation? Here are five stocks we like better. Strong second-quarter performance: Occidental exceeded production guidance, generated approximately $3 billion in free cash flow before working capital, and posted record midstream and marketing earnings of about $960 million. Balance-sheet progress: The company reduced principal debt by $1.5 billion to $11.8 billion, lowered its annual interest expense run rate, and raised its quarterly dividend by 8% to $0.28 per share. Management’s near-term priority is reducing principal debt to $10 billion. Long-term cash-flow plan: Occidental targets more than $4 billion in additional annual sustainable cash flow by 2030, driven by lower costs, reduced sustaining capital, declining production rates and the 2029 preferred-equity redemption rather than production growth. Berkshire Hathaway’s Record Cash Hoard: Why and What's Next? Occidental Petroleum (NYSE:OXY) reported second-quarter results that exceeded its production guidance and produced its highest quarterly free cash flow since the third quarter of 2022, while outlining a plan to add more than $4 billion in annual sustainable cash flow by 2030. President and Chief Executive Officer Richard Jackson said the company is focused on increasing both returns on and returns of capital through the cycle. Its priorities include strengthening the balance sheet, improving resource recovery, reducing costs and generating differentiated cash flow. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Chaos & Crude: 3 Energy Stocks Built to Thrive in This Market “We see a clear pathway to add over $4 billion of annual sustainable cash flow by 2030,” Jackson said. He said the projected improvement would represent approximately 95% annualized growth from 2025 and would be driven by lower costs, lower sustaining capital requirements and a stronger balance sheet rather than production growth. Chief Financial Officer Sunil Mathew said Occidental generated adjusted earnings of $2.40 per diluted share and reported earnings of $2.75 per diluted share in the second quarter. The difference was largely attributed to mark-to-market gains in marketing and crude hedges, as well as a dilution gain in equity investment income. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High How Berkshire Hathaway Performed During Buffett's Final Quarter Free cash flow before working capital was approximately $3 billion, aided by operational performance, cost discipline and higher commodity prices. The company ended the quarter with about $4.2 billion of unrestricted cash. Total production averaged 1.43 million barrels of oil equivalent per day, exceeding the midpoint of guidance by 23,000 BOE per day. Domestic production benefited from strong base and new-well performance in the Permian Basin and higher uptime in the Gulf of America. Those gains more than offset lower international volumes related to disruptions in the Middle East. → No Hangover: Revisiting Microsoft One Week After Earnings Domestic lease operating expense was $7.80 per BOE, 6% below guidance. Mathew said higher domestic production and maintenance schedule optimization in the Gulf of America supported the result. Midstream and marketing adjusted earnings reached a quarterly record of about $960 million, more than double the midpoint of guidance. The segment benefited from gas marketing optimization, crude marketing margins related to cargo-sale timing and commodity-price movements, and higher sulfur prices at Al Hosn. Lower sulfur sales partially offset those factors. Occidental reduced principal debt by $1.5 billion during the period to $11.8 billion, its lowest level since the second quarter of 2019. The company said the reduction brings its go-forward annual interest expense run rate to approximately $760 million, about $630 million below 2025 interest payments. Net principal debt was $7.6 billion at quarter-end, reflecting the company’s cash balance. Near-term maturities remain limited, with only $414 million due through the end of 2029, according to Mathew. The board approved an 8% increase in the quarterly dividend to $0.28 per share. Management said its immediate financial priority remains reducing principal debt to $10 billion. After reaching that target, the company plans to focus on reducing net debt while balancing additional debt repayment with cash accumulation ahead of its preferred equity redemption in August 2029. Share repurchases will remain opportunistic, Mathew said, and a continuous buyback program will be a lower priority until the preferred equity is redeemed. Occidental expects more than $1.2 billion in free-cash-flow improvement in 2026 before the effect of higher oil prices. Management expects roughly $700 million to $800 million of improvement in 2027 versus 2026. Approximately $700 million of the longer-term cash-flow improvement is tied to the preferred equity redemption in 2029. The company said about 85% of the targeted improvements can be achieved even at lower commodity prices. The company expects a $900 million reduction in sustaining capital by 2030, supported by capital-efficiency gains and a lower base decline rate. Occidental expects its base decline rate to fall from roughly 25% to 20% by 2030 as advanced recovery projects mature. Jackson said the company has delivered more than $2 billion in savings since 2023 and remains on track for its 2026 targets. Its initiatives include reducing U.S. onshore well costs, lowering domestic lease operating and transportation expenses, and improving workforce efficiency through simplification and technology deployment. Management also highlighted lower spending in low-carbon ventures. As the Stratos direct air capture project moves from development toward operations, approximately $400 million of low-carbon ventures capital is expected to roll off beginning next year. Jackson said repairs and commissioning work on Stratos Trains 3 and 4 was progressing, with full plant commissioning expected to begin around year-end and operations expected in 2027. For 2027, Occidental’s starting capital-spending level is expected to be $5.9 billion, including investments in mid-cycle projects intended to reduce future decline rates and sustaining capital. At that spending level, management expects production to be relatively flat with 2026. The company said sustaining capital could decline to about $4.5 billion by 2030 through lower declines and further well-cost improvements. For the third quarter, Occidental expects production of 1.4 million to 1.44 million BOE per day. Permian volumes are expected to increase after adjusting for a non-recurring second-quarter uplift, while Rockies output is expected to decline because of activity timing. Planned maintenance timing and a weather contingency are expected to affect Gulf of America production. International volumes are expected to normalize, though management said conditions in the Middle East remain fluid. The company raised its full-year production guidance, citing stronger domestic new-well and base performance that is expected to offset marginally lower international volumes. It maintained full-year capital guidance of $5.5 billion to $5.9 billion and domestic lease operating expense guidance of $8.10 per BOE. Occidental expects third-quarter domestic lease operating expense of $8.75 per BOE due to the Gulf of America maintenance shift and weather contingency. Midstream and marketing income is expected to decline in the third quarter as the Waha-to-Gulf Coast natural-gas spread narrows, though management expects stronger upstream gas realizations to largely offset that effect. The company increased full-year midstream and marketing guidance by $300 million following strong year-to-date performance. Jackson said advanced recovery techniques, including waterflooding, enhanced oil recovery and unconventional CO2 applications, are central to lowering decline rates and increasing recovery. The company also cited stronger well productivity and lower costs in the Powder River Basin, where it is increasing activity as part of its U.S. oil development program. Occidental Petroleum Corporation (OXY) is an international energy company engaged primarily in the exploration, production and marketing of oil and natural gas. The company conducts upstream activities to discover and produce hydrocarbons and operates complementary midstream and marketing functions to transport and sell its production. Occidental also owns a chemicals business that manufactures and sells industrial chemicals and related products for a range of end markets. Occidental's operations are concentrated in the United States, with a significant presence in the Permian Basin, and it maintains exploration and production activities in several international regions, including parts of the Middle East, Latin America and Africa. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Occidental Petroleum Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Adjusted Earnings: $2.40 per diluted share in Q2 2026. Reported Earnings: $2.75 per diluted share in Q2 2026. Free Cash Flow: Approximately $3 billion generated in Q2 2026, the highest level since Q3 2022. Total Production: Averaged 1.43 million BOE per day in Q2 2026, exceeding the midpoint of guidance by 23,000 BOE per day. Domestic Lease Operating Expense: $7.80 per BOE in Q2 2026, a 6% improvement versus guidance. Midstream and Marketing Adjusted Earnings: Approximately $960 million in Q2 2026, a new quarterly record. Principal Debt: Reduced to $11.8 billion, the lowest level since Q2 2019. Net Principal Debt: $7.6 billion, reflecting $4.2 billion of unrestricted cash. Quarterly Dividend: Increased by 8% to $0.28 per share. Q3 2026 Production Guidance: Expected to range between 1.4 million and 1.44 million BOE per day. Full-Year Capital Guidance: Maintained at $5.5 billion to $5.9 billion. Warning! GuruFocus has detected 2 Warning Signs with OXY. Is OXY fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Occidental Petroleum Corp (NYSE:OXY) delivered a strong Q2 2026 with production exceeding guidance and free cash flow of approximately $3 billion, the highest since Q3 2022. The company reduced principal debt to $11.8 billion, the lowest since Q2 2019, and lowered annualized interest by about $630 million compared to 2025. Occidental Petroleum Corp (NYSE:OXY) raised its quarterly dividend by 8% to $0.28 per share, supported by a stronger balance sheet and improved financial flexibility. The company outlined a clear path to add over $4 billion in annual sustainable cash flow by 2030, with approximately 85% achievable even at lower oil prices. Operational efficiencies continue to drive outperformance, including a 6% improvement in domestic lease operating expense versus guidance and record midstream and marketing earnings of $960 million. Occidental Petroleum Corp (NYSE:OXY) faces ongoing disruptions in the Middle East, which negatively impacted international volumes and could continue to affect operations. The company expects a decline in midstream and marketing income in Q3 as the Waha to Gulf Coast natural gas spread narrows, reducing segment profitability. Third-quarter production is expected to be impacted by planned maintenance shifts and weather contingencies in the Gulf of America, as well as activity timing in the Rockies. Occidental Petroleum Corp (NYSE:OXY) continues to face increasing CO2 cost pressure related to higher oil prices, which partially offsets efficiency gains. The company's capital spending for 2027 is expected to be $5.9 billion, a significant increase from 2026 levels, which may pressure near-term free cash flow. Q: Could you talk through the ratability and progression of the cash flow inflection, and unpack the oil and gas efficiencies a bit more?A: CEO Richard Jackson and CFO Sunil Mathew outlined a clear timeline for the $4 billion sustainable cash flow improvement by 2030. They expect roughly $2 billion (close to 50% of the target) to be achieved between 2026 and 2027, driven by the roll-off of Stratos capital, interest expense savings from debt reduction, and continued operational efficiencies. The remaining balance is expected by 2029, including the $700 million preferred equity redemption. The plan is front-end loaded and driven by structural improvements rather than higher oil prices. Q: What is the quantum of growth capital you are willing to spend above sustaining capital, and how are you pacing investment in short-cycle and longer-cycle projects?A: CFO Sunil Mathew clarified that the 2027 capital spending starting point is $5.9 billion, which includes mid-cycle projects. Excluding exploration and multiyear projects like the Gulf of America waterflood, sustaining capital for 2027 is estimated at $5.0-$5.1 billion. The path to the $4.5 billion sustaining capital by 2030 relies on a combination of a lower base decline rate (from ~25% to ~20%) and continued well cost efficiency improvements (targeting 12% by 2030). CEO Richard Jackson added that internal scenarios show a moderate growth scenario (2% CAGR) would actually yield better free cash flow by 2030 than the baseline plan. Q: Can you comment on the application of advanced recovery techniques in unconventional reservoirs and how this is helping to mitigate the decline rate?A: CEO Richard Jackson highlighted that Oxy has been running CO2 EOR pilots in the Permian for 10 years, consistently seeing more than 45% uplift in recovery. This could increase unconventional recovery factors from ~10% to 15%, and potentially 20% with continued CO2 cycling. Three commercial projects are underway, expected online in late 2028-2029, which will contribute to reducing the base decline rate from 25% to 20% by 2030. Ken Dillon added that waterflooding in the Gulf of America and Oman is also contributing, with the Marlin King dump flood already on stream. Q: Sunil made a clear statement that buybacks will take a secondary place to the preferred redemption. Does this imply net debt will continue to drop and you will build cash to redeem the preferred?A: CFO Sunil Mathew confirmed this interpretation. The immediate priority is reducing principal debt to the $10 billion milestone. After that, the focus shifts to further reducing net debt, balancing additional principal reduction with building cash ahead of the August 2029 preferred equity redemption. While leaning towards more debt reduction if the macro is supportive, the company will not provide a new milestone given current oil price volatility. Continuous share buybacks remain a lower priority until the preferred is redeemed. Q: How are you approaching sustainable cost savings beyond interest expense reduction?A: CEO Richard Jackson emphasized a global perspective on cost and efficiency, building on a track record of over $2 billion in savings since 2023. Key initiatives include drilling efficiency (nearly 50% better well delivery per rig), expanding simulfrac operations, and reducing US well costs. CFO Sunil Mathew provided a concrete example: despite dropping three rigs in Q4, the Permian is expected to have 15 more wells online, demonstrating the "doing more with less" philosophy. Q: How does Low Carbon Ventures (LCV) fit into the multiyear plan, especially given the choppy start-up at Stratos?A: CEO Richard Jackson stated that carbon capture technologies still add value, particularly in the Permian where power generation and data center build-out create opportunities to capture CO2. With CO2 and power representing 30% of EOR operating costs, carbon capture can address supply and cost. However, the company is at a meaningful milestone where partners and the market need to help pull projects forward. With Stratos moving from development to operations, approximately $400 million of LCV capital will roll off beginning next year. Q: Can you talk about the puts and takes around midstream and marketing expectations for the second half, including sulfur pricing and gas optimization?A: CFO Sunil Mathew noted the biggest change is the narrowing Waha to Gulf Coast spread as new Permian takeaway capacity comes online. While this reduces midstream income, it is largely offset by stronger upstream gas realizations. For Al Hosn sulfur, spot prices have moved higher, but Middle East disruptions create volatility in freight costs that could impact Q3 realizations. The company increased full-year midstream guidance by $300 million due to strong year-to-date performance. Q: How are you managing the shift in your Permian development model while maintaining productivity leadership?A: CEO Richard Jackson emphasized that well productivity remains core, with steady improvement across all basins. The focus on derisking secondary benches and development efficiency has kept capital intensity below $20 per thousand BOE for several years. Babatunde Cole added that Delaware secondary bench development is running 40% higher than the industry average (2024-2026), with activity increasing from less than 10% to mid-40s of the program, providing confidence in the long-term growth framework. Q: How are you thinking about growth for 2027 and beyond, given the supportive macro environment?A: CEO Richard Jackson explained that "efficiency-led growth" means continuing to drive efficiency while being thoughtful about reinvestment. Key considerations include returns, cost efficiency, free cash flow timing, decline rate management, technology advancement (like unconventional EOR), and macro conditions. CFO Sunil Mathew added that the company evaluated multiple scenarios, and a moderate growth scenario (2% CAGR) with balanced short-cycle and mid-cycle investments would actually improve free cash flow beyond the $4 billion baseline by 2030. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Occidental Petroleum Corporation OXY used its Q2 earnings call to center the story on a multiyear cash flow plan built on lower costs, lower sustaining capital and a stronger balance sheet. Management sees more than $4 billion of annual sustainable cash flow improvement by 2030. Adjusted EPS of $2.40 topped the Zacks Consensus Estimate of $1.92, and revenue of $8.33 billion exceeded the $7.18 billion estimate. Occidental Petroleum Corporation price-consensus-eps-surprise-chart | Occidental Petroleum Corporation Quote President and CEO Richard Jackson said Occidental expects more than $1.2 billion of free cash flow improvement in 2026 before higher oil prices. Jackson said the company sees more than $4 billion of annual sustainable cash flow improvement by 2030 versus 2025. About 85% is expected to be achievable at lower prices, without requiring production growth. Senior vice president and CFO Sunil Mathew said 2027 should add roughly $700 million to $800 million versus 2026. Management expects to capture nearly half of the 2030 target by year-end 2027. Mathew said second-quarter production averaged 1.43 million BOE per day, 23,000 BOE per day above the guidance midpoint. Permian strength and higher Gulf of America uptime offset lower international volumes tied to Middle East disruptions. The CFO said Occidental raised full-year production guidance and expects third-quarter output of 1.40 million to 1.44 million BOE per day. Domestic lease operating expense guidance remains $8.10 per BOE for 2026. Mathew cited adjusted midstream and marketing income of about $960 million, more than double the guidance midpoint. Full-year guidance rose by $300 million, though third-quarter income is expected to fall as the Waha-to-Gulf Coast gas spread narrows. Mathew said principal debt fell to $11.8 billion, reducing the annual interest run rate to about $760 million. The board also approved an 8% dividend increase to $0.28 per share. The CFO reiterated that the immediate priority is reaching $10 billion of principal debt. After that, management plans to reduce net debt while building cash ahead of the preferred equity redemption in August 2029. A Wolfe Research analyst asked whether buybacks would remain secondary. Jackson favored net debt reduction, while Mathew said large continuous repurchases would remain a lower priority until the preferred redemption. A Barclays analyst asked about the pace of sustaining-capital reductions. Mathew said the 2027 capital starting point is $5.9 billion, with sustaining capital at about $5 billion to $5.1 billion after excluding exploration and certain multiyear and growth projects. Mathew said sustaining capital is targeted to reach $4.5 billion by 2030. The plan combines a lower base decline rate, targeted at about 20% by 2030 from roughly 25%, with further well-cost efficiency. Senior vice president and president of International Oil and Gas Operations Kenneth Dillon highlighted waterflooding as a decline-management tool. Jackson added that Permian unconventional CO2 pilots delivered more than 45% uplift in estimated ultimate recovery. A Mizuho analyst asked how management would approach growth as cash flow improves. Jackson said the near-term bias remains toward free cash flow, with added investment required to preserve returns and capital efficiency.Mathew said the baseline assumes no production growth. A moderate-growth scenario with about a 2% production CAGR produced greater free cash flow improvement by 2030 than the baseline. A Goldman Sachs analyst asked about sustainable cost savings. Jackson pointed to drilling efficiency, while Mathew said the Permian plan calls for dropping three rigs in the fourth quarter while still bringing 15 more wells online. Jackson closed with execution, cost efficiency, lower sustaining capital and balance-sheet strength as core priorities. He described the $4 billion plan as a baseline that can improve through efficiencies and measured growth. Mathew kept capital allocation centered on debt reduction and a sustainable dividend, with reinvestment expected to remain measured and efficiency-led. OXY carries a Zacks Rank #4 (Sell), with a Value Score of A, Growth Score of C, Momentum Score of F and VGM Score of B. Value and VGM are favorable, while Growth is middling and Momentum is weak under the Zacks framework. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks methodology places greater weight on the Rank, which reflects earnings-estimate revisions, while Style Scores complement the Rank.The Zacks Rank can change as analysts revise estimates after the just-reported results, so the current mix is not a fixed assessment. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is pivoting to a value-based development approach focused on increasing both return on and return of capital through the cycle rather than chasing production growth. The $4 billion annual sustainable cash flow target for 2030 is supported by durable improvements including lower interest expense, reduced sustaining capital, and operational cost savings. A key strategic pillar is the reduction of the corporate base decline rate from 25% to 20% by 2030, achieved through advanced recovery projects and waterflood developments. Operational outperformance in the Permian and Gulf of America successfully offset production disruptions in the Middle East during the second quarter. The company is leveraging its 16.5 billion BOE resource base to provide a 30-year low-cost development runway across conventional and unconventional assets. Management emphasized that 85% of the projected cash flow improvements are structural and achievable even in lower commodity price environments. The immediate financial milestone is reducing principal debt to $10 billion, which is expected to lower annual interest expense by approximately $740 million compared to 2025. Sustaining capital is projected to decrease by $900 million by 2030 due to improved capital efficiency and the successful mitigation of base decline rates. Low Carbon Ventures (LCV) capital spending is expected to roll off by approximately $400 million starting next year as the Stratos project transitions from development to operations. Future reinvestment for growth will be 'efficiency-led,' with management indicating that a 2% production CAGR scenario could actually enhance free cash flow beyond the baseline plan. The redemption of preferred equity in August 2029 remains a primary focus, with continuous share buybacks categorized as a lower priority until that redemption is complete. Principal debt was reduced to $11.8 billion, the lowest level since 2019, resulting in an annualized interest savings of approximately $630 million versus 2025. Midstream and marketing achieved record adjusted pretax income, though management expects a decline in Q3 as Waha-to-Gulf Coast natural gas spreads narrow. The Stratos DAC plant is undergoing non-technology related repairs on Trains 3 and 4, with full commissioning expected by the end of 2026 and operations in 2027. Management flagged fluid geopolitical conditions in the Middle East as a continued risk to international volume stability and sulfur sales timing. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Approximately $2 billion (50%) of the total improvement is expected to be realized between 2026 and 2027, driven by interest savings and LCV capital roll-off. The remaining $2 billion of the target includes a $700 million preferred equity redemption and an additional $1.3 billion in expected savings achieved between 2028 and 2029. Oxy is seeing a 45% uplift in estimated ultimate recovery (EUR) from CO2 EOR pilots in unconventional wells, potentially moving recovery rates from 10% to 15-20%. Commercial-scale unconventional EOR projects are slated to come online in the 2028-2029 timeframe to support the long-term decline rate reduction. Management clarified that while LCV capital is rolling off, the company will seek partners to fund future development rather than using internal cash flow. The strategy is shifting toward capturing CO2 from emerging power generation and data center builds in the Permian to lower EOR operating costs. Oxy has increased secondary bench development in the Delaware Basin to 45% of activity while maintaining oil productivity 21% higher than the industry benchmark. Efficiency gains allow the company to drop three rigs in Q4 2026 while still bringing 15 more wells online than originally planned.

Occidental Petroleum Corporation OXY reported second-quarter 2026 adjusted earnings of $2.40 per share, surging 823.1% year over year and beating the Zacks Consensus Estimate of $1.92 by 25%. Higher realized crude oil prices and a sharp improvement in Midstream and Marketing supported results. Midstream and Marketing reported adjusted pre-tax income of $961 million, exceeding the high end of the company’s guidance. The segment posted adjusted income of $196 million in the year-ago quarter.Reported earnings were $2.75 per share compared with 26 cents a year earlier. Revenues climbed 57.1% to $8.33 billion and surpassed the Zacks Consensus Estimate of $7.18 billion by 16%.Oil and Gas revenues totaled $6.88 billion, up 37.4% from $5.01 billion in the year-ago quarter. Higher commodity realizations more than offset weakness in domestic natural gas pricing.Midstream and Marketing revenues jumped 240% year over year to $1.33 billion. Interest, dividends and other income totaled $82 million compared with $43 million a year earlier. Occidental Petroleum Corporation price-consensus-eps-surprise-chart | Occidental Petroleum Corporation Quote Worldwide production reached 1,433 thousand barrels of oil equivalent per day (Mboe/d), exceeding the high end of management’s guidance of 1,390-1,430 Mboe/d. Strong domestic performance helped total production rise 2.4% year over year. Permian Resources production averaged 804 Mboe/d, up from 770 Mboe/d in the second quarter of 2025. Production from the region also exceeded the guidance of 783-803 Mboe/d.Gulf of America output rose to 144 Mboe/d from 125 Mboe/d, benefiting from strong base performance and maintenance optimization.Rockies and Other Domestic production increased to 280 Mboe/d from 272 Mboe/d. International production declined to 205 Mboe/d from 233 Mboe/d, partly reflecting disruptions in the Middle East. Occidental’s worldwide realized crude oil price increased 51.8% year over year to $96.78 per barrel. The average WTI and Brent marker prices were $92.79 and $97.06 per barrel, respectively, up from $63.74 and $66.59.Worldwide realized natural gas liquids prices advanced 19% to $24.64 per barrel. However, domestic realized natural gas prices were negative $1.48 per thousand cubic feet in contrast to a positive $1.33 in the prior-year period, limiting part of the commodity-price benefit. Total costs and other deductions declined 4% year over year to $4.55 billion. Oil and gas lease operating expenses slipped 1.6% to $1.12 billion, while transportation and gathering costs increased 3.3% to $463 million.Depreciation, depletion and amortization expenses rose 1.3% to $1.85 billion. Interest and debt expense fell 60.1% to $108 million, reflecting the company’s accelerated debt-reduction efforts. In the first half of 2026, the company brought online 256 wells in the Permian and 84 wells in the Rockies region, which boosted domestic production volumes. In the second quarter, operating cash flow from continuing operations totaled $5.09 billion. Excluding working-capital movements, operating cash flow was $4.61 billion. Capital expenditures totaled $1.59 billion, resulting in free cash flow before working capital of $3.02 billion.Occidental reduced principal debt by $1.9 billion during the quarter to $11.8 billion. The company retired $8.6 billion of debt during the first half of 2026 and ended June with $4.15 billion in cash and cash equivalents. Management also raised the quarterly dividend by 8% to 28 cents per share. For 2026, Occidental now expects total production of 1,423-1,453 Mboe/d compared with earlier expectation of 1,410-1,460 Mboe/d. The outlook includes Permian production of 801-817 Mboe/d and Gulf of America production of 132-136 Mboe/d.The company projects full-year Midstream pre-tax income of $1.3-$1.5 billion. Net capital expenditures are expected between $5.5 billion and $5.9 billion, while adjusted interest expense is forecasted at approximately $680 million. Exploration expenses are expected to be $290 million.For the third quarter of 2026, OXY expects production in the band of 1,400-1,440 Mboe/d. Output from the Permian Resources segment is anticipated at 795-8815 Mboe/d. Occidental expects international production volumes for the third quarter of 2026 to be in the range of 225-231 Mboe/d.In 2026, OXY plans to bring in between 485 and 515 wells online in the Permian and 150-170 wells in the Rockies region. Occidental currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Murphy Oil Corporation MUR reported second-quarter 2026 adjusted earnings of $1.55 per share, up 474.1% year over year. The figure topped the Zacks Consensus Estimate of $1.51 by 2.7%.Revenues of $928.3 million increased 33.5% and beat the consensus estimate of $871 million by 6.5%. Higher commodity prices and solid operating execution supported the results. TotalEnergies SE TTE reported second-quarter 2026 operating earnings of $2.68 (€2.31) per share, which lagged the Zacks Consensus Estimate of $3.07 by 12.7%. The bottom line improved 70.7% from the year-ago figure of $1.57 (€1.38).Total revenues for the second quarter were $57.1 billion, which increased from the year-ago reported figure of $47.9 billion by 27.8%. The metric lagged the Zacks Consensus Estimate of $60.18 billion by 5.13%.Devon Energy Corporation DVN reported second-quarter 2026 adjusted earnings of $1.57 per share, beating the Zacks Consensus Estimate of $1.30 by 20.77%. Revenues of $7.41 billion surpassed the consensus estimate of $6.29 billion by 17.81% and increased 73.1% year over year. Strong oil pricing and contributions from the Coterra Energy merger supported the results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report Devon Energy Corporation (DVN) : Free Stock Analysis Report Murphy Oil Corporation (MUR) : Free Stock Analysis Report TotalEnergies SE Sponsored ADR (TTE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Occidental Petroleum (OXY) reported $8.33 billion in revenue for the quarter ended June 2026, representing a year-over-year increase of 29%. EPS of $2.40 for the same period compares to $0.39 a year ago. The reported revenue represents a surprise of +16.03% over the Zacks Consensus Estimate of $7.18 billion. With the consensus EPS estimate being $1.92, the EPS surprise was +25%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. Here is how Occidental performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Daily Production Volumes - Worldwide Production: 1433 millions of barrels of oil equivalent per day versus 1415.74 millions of barrels of oil equivalent per day estimated by five analysts on average. Net Production Volumes Per Day By Commodity - Natural Gas - Total Worldwide: 2323 millions of cubic feet per day compared to the 2261.63 millions of cubic feet per day average estimate based on five analysts. Net Production Volumes Per Day By Commodity - Oil - Total Worldwide: 713 millions of barrels of oil per day versus 714.3 millions of barrels of oil per day estimated by five analysts on average. Average Realized Prices - Natural Gas - Total Worldwide: $-0.8 per thousand cubic feet compared to the $-0.85 per thousand cubic feet average estimate based on four analysts. Average Realized Prices - NGLs - Total Worldwide: $/24.64 versus $/24.64 estimated by three analysts on average. Average Realized Prices - Oil - Total Worldwide: $/96.78 versus the three-analyst average estimate of $/96.08. Net Production Volumes per Day - International - Oman: 68 millions of barrels of oil equivalent per day versus the two-analyst average estimate of 64.13 millions of barrels of oil equivalent per day. Net Production Volumes Per Day By Commodity - International - Oil - Algeria and Other International: 21 millions of barrels of oil per day compared to the 19.14 millions of barrels of oil per day average estimate based on two analysts. Net Production Volumes Per Day By Commodity - International - Oil - Al Hosn: 13 millions of barrels of oil per day versus 14.22 millions of barrels of oil per day estimated by two analysts on average. Revenues and Other Income- Net Sales- Oil and Gas: $6.88 billion versus the two-analyst average estimate of $6.67 billion. The reported number represents a year-over-year change of +37.4%. Revenues and Other Income- Net Sales- Eliminations: $-143 million versus $-221 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a -42.3% change. Revenues and Other Income- Net Sales- Midstream & Marketing: $1.33 billion versus $701.28 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +211.3% change. View all Key Company Metrics for Occidental here>>> Shares of Occidental have returned +6.6% over the past month versus the Zacks S&P 500 composite's +3.5% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Constellation Energy Corporation CEG reported second-quarter 2026 adjusted operating earnings of $2.55 per share, up 33.5% year over year. The figure beat the Zacks Consensus Estimate of $2.36 by 8.05%, aided by the Calpine contribution and favorable market and portfolio conditions.Adjusted operating earnings increased to $920 million from $599 million a year earlier. The improvement reflected the addition of Calpine, higher capacity revenues and strong commercial performance through portfolio optimization and improved realized customer margins.GAAP earnings were $1.42 per share, down from $2.67 in the prior-year quarter, reflecting several non-GAAP adjustments. Revenues increased 23% to $7.50 billion and surpassed the consensus estimate of $7.47 billion by 0.48%. Nuclear output totaled 44,160 gigawatt-hours (GWh), down from 45,170 GWh in the year-ago quarter. Constellation Energy Corporation price-consensus-eps-surprise-chart | Constellation Energy Corporation Quote Total operating expenses rose 34.5% year over year to $6.93 billion. Purchased power and fuel expenses increased 28.4% to $4.02 billion, while operating and maintenance costs climbed 39.3% to $2.25 billion.Depreciation and amortization expenses advanced 74.4% to $443 million. Consequently, operating income declined 39% to $580 million from $951 million in the second quarter of 2025. Net interest expenses increased to $283 million from $118 million. Excluding Salem and the South Texas Project, CEG’s nuclear plants recorded a capacity factor of 93% compared with 94.8% a year earlier. The company experienced 86 planned refueling outage days, up from 41 days in the prior-year period.Non-refueling outage days declined to 20 from 22. The average nuclear refueling outage lasted 23 days, 40% below the 2025 industry average of 38 days. The quarter also included the successful turbine uprate at Byron Clean Energy Center’s Unit 1. Constellation Energy signed about 920 megawatts (“MW”) of long-term nuclear power purchase agreements with investment-grade customers. The contracts have an average duration of 18.5 years, begin between 2029 and 2031 and are expected to be fully ramped by 2032.The agreements include 890 MW of existing generation. A customer commitment will also support a 30-MW uprate at the Dresden Clean Energy Center. The company expects about 30% of its baseload clean-generation megawatt-hours to be covered by long-term agreements by 2032. Federal Energy Regulatory Commission approved the transfer of existing Capacity Interconnection Rights to the Crane Clean Energy Center, while the Nuclear Regulatory Commission approved the facility’s fuel license amendment. These steps support Constellation’s plan to restart Crane in 2027.CEG also agreed to sell the 606-MW Brazos Valley Energy Center to LS Power for $860 million before closing adjustments. The transaction, expected to close by year-end subject to approvals, would satisfy the final asset-sale requirement tied to the Calpine acquisition. Constellation raised its 2026 adjusted operating earnings guidance to $11.50-$12.50 per share from the prior range of $11-$12. The revised outlook assumes average diluted shares outstanding of 357 million. The Zacks Consensus Estimate for 2026 earnings per share is currently pegged at $11.72.As of June 30, 2026, cash and cash equivalents were $697 million compared with $3.64 billion at the end of 2025. Long-term debt increased to $19.11 billion from $7.25 billion. Operating cash flow for the first six months totaled $1.55 billion, while capital expenditures were $2.52 billion. The company deployed about $2.2 billion year to date toward share repurchases. Constellation has a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Murphy Oil Corporation MUR reported second-quarter 2026 adjusted earnings of $1.55 per share, up 474.1% year over year. The figure topped the Zacks Consensus Estimate of $1.51 by 2.7%.Revenues of $928.3 million increased 33.5% and beat the consensus estimate of $871 million by 6.5%. Higher commodity prices and solid operating execution supported the results. Occidental Petroleum Corporation OXY reported second-quarter 2026 adjusted earnings of $2.40 per share, surging 823.1% year over year and beating the Zacks Consensus Estimate of $1.92 by 25%. Total revenues for the second quarter were $57.1 billion, which increased from the year-ago reported figure of $47.9 billion by 27.8%. The metric lagged the Zacks Consensus Estimate of $60.18 billion by 5.13%.Devon Energy Corporation DVN reported second-quarter 2026 adjusted earnings of $1.57 per share, beating the Zacks Consensus Estimate of $1.30 by 20.77%. Revenues climbed 57.1% to $8.33 billion and surpassed the Zacks Consensus Estimate of $7.18 billion by 16%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Constellation Energy Corporation (CEG) : Free Stock Analysis Report Devon Energy Corporation (DVN) : Free Stock Analysis Report Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report Murphy Oil Corporation (MUR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research