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.

As part of its overall divestments, the company announced that it had agreed to sell an entity which owns certain gas-gathering assets in the Midland Basin for $580m to a division of Enterprise Products Partners.

The oil and gas company said that it has repaid more than $3 billion in debts year-to date.

In extended trading, the company's shares rose by 1.1% on Wednesday.

Occidental's profits were also boosted by a surge in the price of natural gas, which has more than doubled from $1.33 to 1,33 dollars per thousand cubic feet (Mcf) compared to a year ago.

The company reported that the average quarterly realized price of oil was $63,76 per barrel. This is down around 20% compared to a year ago.

Brent crude futures averages dropped about 20% in the second quarter compared to a year ago, as tariffs imposed by U.S. president Donald Trump created global uncertainty that weighed down on oil demand.

The Houston-based company has also cut the mid-point forecast for capex in current year by $100 million, and international operating expenses by $50 million.

According to LSEG data, the company reported a profit adjusted of 39 cents for the quarter ending June 30. This compares with an average analyst estimate of 29 cents.

(source: Reuters)