Occidental CEO: Chemical divestiture to improve core oil and gas business
CEO Vicki Hollub said in an interview with the Associated Press on Thursday that Occidental Petroleum would be better positioned to invest in the core oil and natural gas business following the divestiture of a chemical unit. The company will also be able replace the cash flow lost from the division within two and a quarter years. Occidental shares fell more than 7% after Occidental announced earlier that day that they would sell their OxyChem division to Warren Buffett’s Berkshire Hathaway unit for $9.7billion and use the money to pay down debt.
S&P 500 and Nasdaq fall after setting intraday records, as momentum wanes
S&P 500 index and tech-heavy Nasdaq index retreated on Thursday after reaching intraday records earlier in the day. Investors locked in gains as the U.S. shutdown entered its second day. The rapid pullback highlights how fragile the market momentum is, with stretched values and uncertainty over the Federal Reserve’s lack of visibility in economic data keeping traders at edge. Anthony Saglimbene is the chief market strategist of Ameriprise Financial. Tesla fell nearly 2% following initial gains after a strong report on quarterly deliveries.
S&P 500 and Nasdaq reach intraday records as rate-cutting hopes overshadow shutdown fears
S&P 500 and Nasdaq both hit intraday records at the market opening on Thursday. This was due to renewed expectations of interest rate reductions. Traders are bracing for a week-end with little data, but few new catalysts. Investors have been able to ignore the uncertainty of the U.S. Government Shutdown because they are anchored to a Federal Reserve that is dovish. The labor market is at the core of the Fed’s policy outlook, and it's a crucial part of its dual mandate. Investors are increasingly relying on alternative data sources as the government shutdown has created a data vacuum.
Occidental reduces debt by selling Berkshire's chemicals unit for $9.7 billion
Occidental Petroleum announced on Thursday that it will sell OxyChem, its chemicals division, to Warren Buffett’s Berkshire Hathaway, for $9.7 Billion. This is the largest divestment to date to reduce debt following years of expensive acquisitions. The deal would be Berkshire's largest since the $11.6 billion acquisition of Alleghany Corporation by Berkshire in 2022. It would also expand the chemical portfolio of Berkshire beyond Lubrizol. Berkshire, Occidental’s largest shareholder, began acquiring stakes in the U.S. producer of oil and gas in February 2022. This was around the time that Russia invaded Ukraine.
WSJ reports that Berkshire is in negotiations to purchase OxyChem from Occidental for around $10 billion.
The Wall Street Journal, citing sources familiar with the situation, reported Tuesday that Berkshire Hathaway was in discussions to purchase Occidental Petroleum’s petrochemical division for around $10 billion. The sale of OxyChem, which provides products for sectors like medical care, food safety and construction, will add to the series of divestitures that the U.S. Oil and Gas producer has made in recent years. Occidental, where Berkshire already holds the majority stake, is struggling with a heavy amount of debt.
The US cuts to oil jobs and expenditure threaten the output growth
Due to the lower oil price and the largest consolidation in the last generation, the U.S. Oil industry has cut thousands of jobs and billions of dollars in spending. This could be the end of rapid growth in output that made the U.S. world's leading producer. Organization of the Petroleum Exporting Countries (OPEC) and its allies within the OPEC+ group of producers are increasing production to regain market share lost in recent years to the United States. OPEC+ decided on Sunday to increase production by 137,000 barrels a day from October.
Occidental Petroleum beats quarterly profit, discloses additional divestments
Occidental Petroleum on Wednesday beat Wall Street's expectations for the second quarter profit, as higher production offset lower crude oil prices. The average quarterly global production of the company was 1.4 million barrels per day (MMboepd), an increase of about 11% compared to a year ago. Exxon Mobil, Chevron and other oil giants reported last week that they had beaten their quarterly profit expectations due to higher production. This helped them to offset the lower crude price. Occidental has also announced $950 million in additional divestitures, with $370 million of them already completed.
Industry leaders claim that despite volatility, US Gulf oil production could reach 2.4 millions bpd.
Leaders in the oil and gas sector said that the U.S. Gulf of Mexico could continue to grow oil production despite geopolitical instability not seen for decades. Since last month, U.S. President Donald Trump’s global tariff announcements contributed to a drop in oil prices, and fears of a recession, making it harder for oil producers who follow his "drill baby, drill" call. "We have never experienced such geopolitical instability," said Occidental Petroleum's CEO Vicki Hollub during a Monday panel discussion at Offshore Technology Conference.
Occidental Petroleum announces higher oil and gas prices in Q1
Occidental Petroleum, a U.S. shale company, said that the prices received by the firm for its oil and gas production in the first quarter of this year were higher than the previous three months. Benchmark Brent crude averaged $74.98 per barrel in the first quarter of 2018, up 1.3% compared to the previous quarter. Meanwhile, U.S. Natural Gas prices increased 30% due to a higher demand because of a cold winter. Exxon Mobil, the industry leader, also said that higher oil and gasoline prices as well as stronger refining margins will help boost its earnings by approximately $900 million.
Occidental’s 1PointFive is granted permits to sequester carbon dioxide at a Texas facility
1PointFive, a unit of Occidental Petroleum, announced on Monday that the U.S. Environmental Protection Agency approved its request to sequester CO2 captured at its direct air capture facility (DAC) in Texas. Stratos is a joint-venture between BlackRock, a global asset manager, and the carbon capture and storage unit of the U.S. shale company. Stratos, one of the largest DAC plants in the world, is expected to begin commercial operations by later this year. Oil companies like Chevron and TotalEnergies are adopting carbon capture…
Sources say that the Energy Department may cut funding for US carbon removal hubs.
Three sources familiar with this matter have confirmed that the U.S. Department of Energy has been considering cutting hundreds of millions of dollar in grants for two projects in Texas or Louisiana, which are aimed at demonstrating commercial-scale technology to capture CO2 from the air. Direct Air Capture hubs were developed by the DOE Office of Clean Energy Demonstrations as part of the former president Joe Biden’s efforts to reduce U.S. greenhouse gases emissions. The hubs are expensive and new technology for carbon removal.
Carlyle is looking for buyers of Colombian oil producers
According to sources familiar with the matter, Carlyle's private equity group is looking for a buyer of its Colombian oil company SierraCol. The price would be around $1.5 billion. SierraCol was established by Carlyle in 2020, after purchasing assets from Occidental Petroleum. With a production of 45,000 barrels equivalent per day, it is the largest independent producer of Colombia. According to a SierraCol website presentation, its free cash flow for the year ended September was $172 millions and its net debt was $511 million. Carlyle declined comment.
Trump's Energy dominance aims to attract more global companies to the US
Executives said that the market upheaval caused by U.S. president Donald Trump's protectionist policies on trade has not dampened interest from foreign investors in the U.S. Energy Industry. They praised his promise to reduce regulations and support fossil energies. Trump made energy dominance the cornerstone of his administration. He declared a national emergency on his first official day in office, and pulled the U.S. out of the Paris Climate Agreement. He has encouraged energy companies to increase fossil fuel production, and promised lower prices for consumers. Trump's energy stance has been widely welcomed by the U.S.
Occidental divests some upstream assets worth $1.2 billion
Occidental Petroleum announced on Tuesday it had signed two deals to sell some upstream assets for a combined $1.2 billion to unidentified buyers. The transaction, which includes non-operated Rockies assets and Permian Basin properties that are not included in the company's short-term development plans, is expected to be completed by the end the current quarter. The company stated that it intended to use the proceeds of the transaction to reduce its debt. Houston-based Occidental said it also achieved…
Ecopetrol shares fall after Colombian Petro demands sale of US Fracking business
Ecopetrol, Colombia's largest state-owned energy company, fell by 2.20% to 2,005 pesos (US $0.48) each in the early hours of trading on Wednesday. This was after President Gustavo Petro demanded that the company sell its U.S. Fracking business. Petro's remarks late on Tuesday came after the news Monday that Ecopetrol agreed to extend their joint venture with Occidental Petroleum at the Permian Basin in Texas. The New York ADRs of the company also dropped 2.84%, to $9.57 a unit. Ecopetrol has been able to maintain its production despite a decline in output in other parts of the group.
Colombia's Petro wants Ecopetrol to sell its fracking operations.
The Colombian president Gustavo Petro called on Tuesday for the sale by Ecopetrol of its fracking operations within the United States in order to invest in renewable energy. In an unusual live broadcast, the leftist leader made his request to Andres Camacho, minister of mines, energy and environment. He said: "I would like this operation sold to invest in clean power in Colombia. The meeting took place a day after Ecopetrol had announced an agreement with Occidental Petroleum to renew their oil joint venture in the U.S. Permian Basin of Texas.
Colombia's Ecopetrol extends joint venture agreement with Occidental Petroleum for Permian Basin
Ecopetrol, a Colombian energy firm, announced on Monday that it had reached an agreement with Occidental Petroleum to renew their oil joint venture in the U.S. Permian Basin in Texas. The future of the joint-venture was uncertain after Ecopetrol – which is majority owned by the Colombian government – backed out from a separate agreement last August, to purchase $3.6 billion worth of assets in the Permian Basin from Occidental, on President Gustavo Petro's orders. Petro's government has set as a priority the weaning of Andean countries off fossil fuels.
Oil industry unlikely rush to Alaska despite Trump’s call for drilling
U.S. companies will not expand their development in Alaska or the Arctic after President Donald Trump signed an executive order that allows them to do so. Industry representatives and company officials said this, pointing out that a future president would be able to reverse Trump's decision. U.S. Oil Production is Already at Record Levels. This is largely due to the increased production of oil in more accessible areas such as Texas and New Mexico. Companies have also limited their spending on new projects, focusing on returning cash to investors.
Diamondback Energy reports lower oil prices in the fourth quarter
Diamondback Energy, the U.S. producer of shale oil, announced on Monday that its production prices were lower in the fourth quarter compared with the previous three months. Crude oil prices dropped about 6% during the quarter of October-December, due to a patchy recovery from the pandemic, China's slow economy, and an excess supply worldwide. Prices are down nearly 12% compared to a year earlier. The company reported that the average realized price, or the price received for its total oil production during the quarter ended December 31, was $69.48 per barrel, compared to $73.13 in the previous quarter.
Occidental Petroleum received lower prices for oil it produced in the fourth quarter
Occidental Petroleum, a U.S. shale oil producer, said that the prices received for oil produced in the fourth quarter of 2014 were lower than those for the previous three months due to a weakening global demand. The crude oil prices fell by about 6% sequentially in the fourth quarter of last year due to a patchy recovery from the pandemic, China's slow economy, and an excess supply worldwide. Prices dropped nearly 12% compared to a year earlier. Exxon Mobil, a larger competitor and industry leader, warned…