v3.25.2
DERIVATIVES
 6 Months Ended
Jun. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVES
NOTE 6 - DERIVATIVES

OBJECTIVE AND STRATEGY
Occidental uses a variety of derivative financial instruments and physical contracts to manage its exposure to commodity price fluctuations and transportation commitments and to fix margins on the future sale of stored commodity volumes. Derivatives are carried at fair value and on a net basis when a legal right of offset exists with the same counterparty. Occidental may occasionally use a variety of derivative financial instruments to manage its exposure to foreign currency fluctuations and interest rate risks. Occidental also enters into derivative financial instruments for trading purposes.
Occidental may elect normal purchases and normal sales exclusions when physically delivered commodities are purchased from a vendor or sold to a customer.

MARKETING DERIVATIVES
Occidental's marketing derivative instruments are short-duration physical and financial forward contracts. As of June 30, 2025, the weighted-average settlement price of these forward contracts was $65.38 per barrel and $2.45 per Mcf for crude oil and natural gas, respectively. The weighted-average settlement price was $71.07 per barrel and $3.50 per Mcf for crude oil and natural gas, respectively, as of December 31, 2024. Derivative instruments that are not designated as hedging instruments are required to be recorded on the balance sheet at fair value. Changes in fair value will impact Occidental’s earnings through mark-to-market adjustments until the physical commodity is delivered or the financial instrument is settled. Net gains and losses associated with marketing derivative instruments are recognized currently in net sales.
The following table summarizes net short volumes associated with the outstanding marketing commodity derivatives as of:

long (short)June 30, 2025December 31, 2024
 Oil commodity contracts
Volume (MMbbl)(54)(34)
Natural gas commodity contracts
Volume (Bcf)(182)(130)
FAIR VALUE OF DERIVATIVES
The following tables present the fair values of Occidental’s outstanding derivatives. Fair values are presented at gross amounts below, including when the derivatives are subject to netting arrangements, and are presented on a net basis in the Consolidated Condensed Balance Sheets:

millionsFair Value Measurements Using
Netting (a)
Total Fair Value
Balance Sheet ClassificationsLevel 1Level 2Level 3
June 30, 2025
Marketing Derivatives
Other current assets$1,214 $94 $— $(1,238)$70 
Other long-term assets10 — — (5)5 
Accrued liabilities(1,200)(58)— 1,238 (20)
Deferred credits and other liabilities - other(5)(2)— 5 (2)
December 31, 2024
Marketing Derivatives
Other current assets$455 $92 $— $(512)$35 
Other long-term assets— 1 — (1)— 
Accrued liabilities(451)(90)— 512 (29)
Deferred credits and other liabilities - other— (2)— 1 (1)
(a)These amounts do not include collateral. Occidental netted $11 million of collateral received from brokers against derivative assets as of June 30, 2025. As of December 31, 2024, Occidental netted $12 million of collateral received from brokers against derivative assets and $9 million collateral deposited with brokers against derivative liabilities.

GAINS AND LOSSES ON DERIVATIVES
The following table presents gains and losses related to Occidental's derivative instruments and the location on the Consolidated Condensed Statements of Operations.

millionsThree months ended June 30,Six months ended June 30,
Income Statement Classification2025202420252024
Marketing derivatives (included in net sales)$97 $(58)$(10)$(296)

CREDIT RISK
The majority of Occidental’s credit risk is related to the physical delivery of energy commodities to its counterparties and their potential inability to meet their settlement commitments. Occidental manages credit risk by selecting counterparties that it believes to be financially strong, by entering into netting arrangements with counterparties and by requiring collateral or other credit risk mitigants, as appropriate. Occidental actively evaluates the creditworthiness of its counterparties, assigns appropriate credit limits and monitors credit exposures against those assigned limits. Occidental also enters into futures contracts through regulated exchanges with select clearinghouses and brokers, which are subject to minimal credit risk, if any.