These excerpts taken from the OXY 10-K filed Feb 24, 2009.
Oil and gas prices are the major variables that drive the industrys short and intermediate term financial performance. Average oil prices were stronger in 2008 over 2007, as a result of steadily increasing prices during the first half of the year followed by a steep price decline in the second half, and ended the year lower than the 2007 year-end levels. West Texas Intermediate (WTI) settled at $145.31 per barrel on July 3, 2008, up from $95.98 per barrel as of December 31, 2007, and then dropped to $44.60 per barrel at the end of 2008. The average WTI market price for 2008 was $99.65 per barrel compared with $72.32 per barrel in 2007. Occidentals realized price for crude oil as a percentage of average WTI prices was approximately 89 percent and 90 percent for 2008 and 2007, respectively. Prices and differentials can vary significantly, even on a short-term basis, making it impossible to predict realized prices with a reliable degree of certainty.
The average New York Mercantile Exchange (NYMEX) domestic natural gas price in 2008 increased approximately 27 percent from 2007. For 2008, NYMEX gas prices averaged $9.01 per Mcf compared with $7.12 per Mcf for 2007, but was $5.62 per Mcf as of December 31, 2008.
The chemical segment earnings increased in 2008 despite the deepening global economic downturn. Higher prices and margins for caustic soda were the primary drivers of the earnings improvement. Increased demand for and competitiveness of domestically produced products in export markets, aided by favorable feedstock prices and foreign currency exchange rates, also contributed to the improved earnings. Partially
offsetting these improvements was the continued fallout from the eroding United States housing market, which resulted in lower domestic demand and earnings in the PVC business.
The midstream and marketing segment gathers, treats, processes, transports, stores, trades and markets crude oil, natural gas, NGLs, condensate and CO2 and generates and markets power. Midstream and marketings 2008 earnings increased, reflecting an increase in gas processing margins at the Dolphin Pipeline investment.
This excerpt taken from the OXY 10-K filed Feb 22, 2008.
The chemical segment results decreased in 2007 due to the softening United States housing market and continued high feedstock costs, which led to lower margins in the PVC business. This was partially offset by an increase in demand for United States products in export markets in 2007 aided by expanding international economies along with favorable foreign currency exchange rates.
This excerpt taken from the OXY 10-K filed Mar 1, 2006.
The chemical segment experienced improved results in 2005 due to sustained demand coupled with improved margins despite sharply higher feedstock costs. The widespread impact of Hurricanes Katrina and Rita in the third quarter caused several disruptions among chlor-alkali producers and their customers. This resulted in a moderate softening of product demand.