Occidental Petroleum stock (US6745991058): Warren Buffett stake and oil price moves keep investors on edge

Occidental Petroleum is back in focus as oil prices fluctuate and Warren Buffett’s Berkshire Hathaway keeps adding to its stake. What is driving the stock now, and how does the US-focused energy group make its money?

Occidental Petroleum stock remains in the spotlight as the US oil and gas producer continues to benefit from higher energy prices and the ongoing interest of Warren Buffett’s Berkshire Hathaway. On 05/01/2024, the company reported first-quarter 2024 results marked by strong cash generation and continued debt reduction, according to Occidental Petroleum as of 05/01/2024. In parallel, Berkshire disclosed incremental share purchases during 2024, reinforcing market attention on the stock, as documented by SEC filings as of 03/31/2024.

As of: 05/22/2026

By the editorial team – specialized in equity coverage.

At a glance

• Name: Occidental Petroleum
• Sector/industry: Energy, oil and gas exploration and production
• Headquarters/country: Houston, United States
• Core markets: Onshore US (Permian Basin, Rockies), Middle East and North Africa, Gulf of Mexico
• Key revenue drivers: Crude oil and natural gas production, chemicals (OxyChem), midstream and marketing
• Home exchange/listing venue: New York Stock Exchange (ticker: OXY)
• Trading currency: US dollar (USD)

Occidental Petroleum: core business model

Occidental Petroleum is a large US-based energy company focused on exploration and production of oil and natural gas. The group’s strategy is built around its sizable resource base in the Permian Basin in Texas and New Mexico, complemented by international operations and a chemicals division. Management highlights a focus on capital discipline, free cash flow generation and shareholder returns, based on company statements in the first-quarter 2024 report published 05/01/2024, according to Occidental Petroleum as of 05/01/2024.

The core of Occidental Petroleum’s upstream business is unconventional oil and gas production, particularly from shale and tight formations in the US. The company invests in drilling, completion and enhanced oil recovery technologies to increase recovery rates and lower unit costs. This upstream activity exposes the group to global commodity price cycles, which means earnings and cash flows can fluctuate meaningfully with changes in oil and gas prices, as illustrated by results over recent years in the group’s annual report released 02/15/2024 for the year 2023, referenced by SEC filings as of 02/15/2024.

In addition to hydrocarbons, Occidental Petroleum operates a chemicals business, OxyChem, which produces chlor-alkali products, vinyls and other basic chemicals. This segment is less directly tied to oil prices and more influenced by industrial and construction demand. It has historically provided some diversification to the group’s earnings stream. The company also runs midstream and marketing operations that handle processing, transportation and trading of hydrocarbons, contributing to earnings but also adding exposure to commodity spreads and logistics conditions.

Occidental Petroleum positions itself as both a conventional hydrocarbons producer and an emerging player in carbon management. The company is investing in carbon capture, utilization and storage technologies and has announced several large-scale direct air capture projects in the United States. These initiatives aim to create a new revenue stream over time, particularly through selling carbon removal credits to industrial customers, as described in investor presentations published 2023 and 2024, referenced by Occidental Petroleum as of 03/04/2024.

Main revenue and product drivers for Occidental Petroleum

The primary revenue driver for Occidental Petroleum is crude oil production, particularly from its onshore US assets in the Permian Basin. Oil sales provide the largest share of total revenue and cash flow and are directly linked to benchmark prices such as West Texas Intermediate (WTI). When WTI prices are elevated, Occidental typically generates higher operating cash flows, which can support debt reduction, dividends and share repurchases, as illustrated in the company’s full-year 2023 results published 02/15/2024, according to Occidental Petroleum as of 02/15/2024.

Natural gas and natural gas liquids are the second key category. These products are sold into US and international markets at prices influenced by local supply-demand balances and infrastructure. Gas markets have exhibited higher volatility over recent years, which has affected Occidental’s realized prices and revenue mix. The group reports average realized prices and volumes for each product line in its quarterly earnings releases, enabling investors to track how price and volume changes contribute to revenue developments, based on the metrics disclosed for the first quarter of 2024 by Occidental Petroleum as of 05/01/2024.

The OxyChem division adds a more industrial earnings profile. It sells basic chemicals to PVC manufacturers, water treatment companies and various industrial customers. Revenue here is driven by production volumes, contract structures and broader industrial demand, particularly in the construction and infrastructure sectors. Chemical margins can be less volatile than upstream margins, but they still fluctuate with feedstock costs and competition. In prior reporting periods, management has emphasized OxyChem’s role in stabilizing overall cash flow, particularly when oil prices are under pressure, according to commentary in the 2023 annual report released 02/15/2024, referenced by SEC filings as of 02/15/2024.

Midstream and marketing activities provide additional earnings levers. Occidental owns or contracts gathering systems, pipelines, processing facilities and export capabilities. These assets allow the company to bring its production to market and to optimize price realizations. Revenue in this segment depends on throughput volumes, tariffs and commodity spreads. While midstream operations can add stability through fee-based contracts, marketing activities can introduce additional market risk, especially when commodity curves are volatile.

Another emerging driver is carbon management and sequestration. Occidental is developing direct air capture plants in the US, designed to remove carbon dioxide from the atmosphere and store it permanently underground. The economics of these projects rely on technological performance, US policy incentives such as tax credits and corporate demand for carbon removal credits. Though this business is still small compared with hydrocarbons, the company presents it as a potential long-term growth area, as communicated in sustainability and strategy materials updated during 2023 and 2024, according to Occidental Petroleum as of 03/04/2024.

Why Occidental Petroleum matters for US investors

For US investors, Occidental Petroleum is one of the more visible energy names on the New York Stock Exchange, partly because of its scale and partly due to Warren Buffett’s ongoing involvement. Berkshire Hathaway has built a significant stake in the company over several years, viewing it as a leveraged play on long-term oil fundamentals, according to ownership disclosures in SEC filings as of 03/31/2024, referenced by SEC filings as of 03/31/2024. This association often draws additional attention from retail and institutional investors in the US.

Occidental Petroleum is also relevant because it provides direct exposure to US shale production, particularly in the Permian Basin, a region that has reshaped global oil supply dynamics. Investors seeking to understand how US shale responds to price changes often track Occidental’s capital spending plans, production targets and cost trends. The company’s guidance on these metrics in its quarterly updates offers clues about broader industry behavior, as described in the first-quarter 2024 presentation released 05/01/2024, according to Occidental Petroleum as of 05/01/2024.

From a portfolio perspective, Occidental Petroleum can act as a cyclical component tied to energy prices. When oil prices rise, energy stocks can sometimes outperform broader equity indices, while they may lag during periods of weak demand or oversupply. US investors with exposure to domestic indices may already hold Occidental indirectly through index funds, as the company is part of major benchmarks. Understanding the drivers of its earnings and balance sheet can therefore provide context for portfolio risk and diversification.

Conclusion

Occidental Petroleum combines a large US-focused upstream portfolio, an established chemicals division and emerging carbon management ambitions. Earnings and cash flow remain closely tied to oil and gas prices, which means the stock can be volatile. Management has emphasized debt reduction, disciplined capital allocation and balanced shareholder returns following the integration of past acquisitions, according to recent annual and quarterly reports released between 02/15/2024 and 05/01/2024, referenced by Occidental Petroleum as of 05/01/2024. For investors, a careful view of commodity assumptions, cost trends and the evolving role of carbon management will likely remain central when assessing the company’s longer-term prospects.

Disclaimer: This article does not constitute investment advice. Stocks are volatile financial instruments.