Occidental (OXY.US) announced mixed financial results for the first quarter of 2026. The company reported quarterly revenue of $5.23 billion, falling short of the analyst consensus estimate of $5.67 billion. In terms of profitability, net income attributable to common stockholders was $3.2 billion, a significant increase from $766 million in the same period last year, primarily driven by gains from the sale of the OxyChem business. Adjusted earnings per share were $1.06, substantially exceeding the average analyst estimate of $0.59.
The first-quarter performance reflected benefits from rising oil prices, with the average realized oil price increasing to $69.91 per barrel. The company stated that daily production reached 1.426 million barrels of oil equivalent, exceeding the high end of its guidance. Occidental CEO Vicki Hollub commented, "Our first-quarter results demonstrate strong operational performance and our team's exceptional execution across the asset portfolio."
Ongoing conflicts in the Middle East have introduced volatility into global energy markets, particularly as key shipping chokepoints like the Strait of Hormuz have been nearly disrupted. Any interruption or potential risk to oil supplies tends to elevate prices as traders factor potential shortages into the market. This dynamic has supported higher selling prices for producers, including Occidental, boosting revenue and cash flow even amid a broader environment of uncertainty.
Cash flow from continuing operations totaled $1.4 billion, while cash flow from operations before working capital changes was $3.2 billion. Capital expenditures amounted to $1.6 billion, resulting in free cash flow before working capital changes of $1.7 billion.
Performance in the oil and gas segment improved sequentially, primarily benefiting from higher crude prices, despite a slight decline in production volumes. Meanwhile, the midstream and marketing segment reported a pre-tax loss, reflecting timing effects and volatility related to derivatives.
Occidental continues to focus on strengthening its balance sheet, having repaid $7.1 billion of debt by early May and reducing total principal debt to $13.3 billion. The company aims to further reduce this figure to $10 billion. Management emphasized that cost discipline, efficiency improvements, and portfolio optimization remain central to its strategy for navigating commodity price cycles and geopolitical risks.
Furthermore, due to pressures on its global operations from the Middle East conflict, Occidental has revised its full-year production forecast downward. The company holds a 40% interest in the Shah Gas Field in the UAE, one of the world's largest sour gas fields, where operations have been suspended since March 16. Occidental's other international assets, located primarily in Algeria, Oman, and Qatar, accounted for 16.2% of its total production in 2025.
The company now expects its 2026 international production to be between 218,000 and 228,000 barrels of oil equivalent per day, down from a previous forecast of 230,000 to 240,000 barrels. Occidental has also lowered its total 2026 production guidance to a range of 1.41 million to 1.46 million barrels of oil equivalent per day, compared to the prior outlook of 1.42 million to 1.48 million barrels.