Oxy’s January: Oil, Exits & Debt (It’s Complicated)

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So, Occidental Petroleum (OXY +2.19%) had a January. Like, a good January. Shares jumped over 10%, which, in the current economic climate, is basically the corporate equivalent of winning the lottery. The S&P 500 managed a polite 1.4% rise, which is…nice. Good for them. But Oxy? They were leaning in.

The usual suspect – oil prices – played a role, obviously. But let’s be real, it wasn’t just about black gold. It was a whole situation. A confluence of events. Basically, a plot twist worthy of a streaming drama.

Ending the Drought (Finally)

Crude prices decided to cooperate last month. Brent rocketed 16%, WTI by 14%. It was the first monthly increase in, oh, six months. Six months! That’s an eternity in the oil business. It’s like, remember when we thought we’d never see a price increase again? Good times. (Not really.)

The drama? Venezuela. Apparently, the U.S. military decided to stage an intervention involving the former president and some…narcoterrorism charges. Look, I’m a macro strategist, not a geopolitical analyst, but it seems like disrupting oil infrastructure in a country already having a bad day might impact supply. And then there’s Iran, always a reliable source of…complications. It’s a whole geopolitical chess game, and honestly, I need a nap.

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Higher oil prices mean more cash for Oxy, which is always good. They can pay down debt, maybe buy a yacht…just kidding. (Mostly.) It allows them to actually focus on, you know, being an oil company, instead of just managing a balance sheet that resembles a ransom note.

More Forward Progress (They Said That On The Earnings Call)

But here’s where it gets interesting. Oxy closed the sale of its OxyChem business to Berkshire Hathaway. $9.7 billion. That’s a lot of money. Enough to make even Warren Buffett raise an eyebrow. They’re using $6.5 billion of it to pay down debt, which is responsible. Adulting, even for oil companies. It’s like Marie Kondo-ing their balance sheet: “Does this debt spark joy? No? Get rid of it!”

They also tweaked a contract with Western Midstream Partners, switching from a cost-of-service agreement to a fixed-fee structure. Basically, they’re streamlining. Cutting costs. It’s corporate buzzword bingo. They’re transferring some ownership units, saving money, and generally making things…more efficient. Western Midstream gets to be its own entity, which is nice for them. Everyone wins! (Except maybe the accountants.)

A Strong Start to 2026 (Don’t Jinx It)

So, Oxy got a boost from oil prices and some strategic asset sales. They’re on track with their debt reduction goals, and they have a little more flexibility to actually, you know, produce oil. It’s a good start to the year. Let’s just hope they don’t jinx it by announcing some ambitious new sustainability initiative. Because, honestly, that’s just asking for trouble.

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2026-02-06 19:12