Occidental Petroleum Stock Slips Friday: What's Going On?

Occidental Petroleum Corp (NYSE:OXY) shares are slightly lower Friday morning after strong gains earlier this week. Here’s what investors need to know.

• Occidental Petroleum stock is showing weakness. What’s driving OXY stock lower?

Occidental Earnings Beat Expectations

Occidental reported fourth-quarter earnings on Wednesday, revealing adjusted earnings per share of 31 cents, surpassing the consensus estimate of 18 cents.

The company also reported total production of 1,481 thousand barrels of oil equivalent per day, exceeding guidance, while midstream and marketing pre-tax adjusted income also outperformed expectations.

In addition to the earnings report, geopolitical tensions involving Iran have kept crude prices elevated, which typically benefits oil stocks. Furthermore, reports indicate that Kinetik Holdings is considering a sale after receiving interest from Occidental-backed Western Midstream Partners, which could influence market sentiment around Occidental.

The stock’s rise this week is also supported by Occidental’s sale of its OxyChem division to Berkshire Hathaway for $9.7 billion, which has allowed the company to cut approximately $5.8 billion in debt, strengthening its balance sheet while broader markets are experiencing gains.

Occidental Boosts Dividend After Debt Reduction

Occidental’s recent actions have also led to a more robust financial position, with its principal debt now around $15 billion. This strategic move has also enabled the company to increase its quarterly dividend by over 8% to 26 cents per share, reflecting a shift from debt reduction to returning capital to shareholders.

The company is not only focusing on debt reduction but is also doubling down on its core oil and gas operations, particularly in the Permian Basin, which is crucial for its production and growth plans.

Berkshire Hathaway remains a significant stakeholder, holding approximately 28% of Occidental.

Occidental Trades Above Key Averages

Occidental is trading 12.4% above its 20-day simple moving average (SMA) and 20% above its 100-day SMA, demonstrating strong short-term and longer-term strength.

Shares have decreased by 1.37% over the past 12 months and are positioned closer to their 52-week highs than lows, reflecting a solid recovery trajectory.

The RSI is at 71.58, indicating that the stock is in overbought territory, while the MACD shows a bullish signal with a value of 1.3818, above its signal line at 1.0862.

This combination suggests that while the stock is currently overbought, there is still bullish momentum supporting its price action.

• Key Resistance: $52.50
• Key Support: $42.00

OXY Price Action: Occidental Petroleum shares were down 1.57% at $50.72 at the time of publication on Friday. The stock is approaching its 52-week high of $52.58, according to Benzinga Pro data.

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