Occidental Petroleum
Executive Summary Occidental Petroleum Corporation (OXY) prevailed in 2009 regardless of the state of the global economy and competition from larger companies. Focusing on long-term growth, Occidental aims to increase production and profits by acquiring local and global oil and gas reserves. They maintain their competitive advantage through the development of strong relationships with both local foreign counterparties. This is typically a difficult feat when faced with potential commodity, exploration, and political risks; however, OXY is profitable in their volatile industry by effectively managing these risks.
Despite the hardships most companies faced in 2009, Occidental Petroleum Corporation (OXY) persevered by concentrating on long-term growth. They worked to establish relationships with foreign counterparties enabling them to expand in the US, Middle East, North Africa, and South America. This is no easy feat since the latter countries pose threats due to unstable environments; however, Occidental is used to managing risk because they operate in a volatile industry that presents commodity, exploration and political risks. With their global connections and regular monitoring of market activities, Occidental Petroleum Corporation proves they can be profitable by managing their risks. Occidental Petroleum sustains its billion-dollar earnings with a business model that emphasizes long-lived assets with long-term growth potential. They satisfy this model with their chemical sector of oil and gas. Operating in thirty-five countries, OXY continues to lead in the oil & gas exploration and production industry in cash flow per barrel.[1] This amounts to sizeable cash flows that exceed their typical expenses.[2] Furthermore, Occidental measures their success by their ability to maintain below-average debt levels, deliver returns in excess of its cost of capital and by achieving top quartile performance in relation to its peers.[3] Having developed strong
Despite the hardships most companies faced in 2009, Occidental Petroleum Corporation (OXY) persevered by concentrating on long-term growth. They worked to establish relationships with foreign counterparties enabling them to expand in the US, Middle East, North Africa, and South America. This is no easy feat since the latter countries pose threats due to unstable environments; however, Occidental is used to managing risk because they operate in a volatile industry that presents commodity, exploration and political risks. With their global connections and regular monitoring of market activities, Occidental Petroleum Corporation proves they can be profitable by managing their risks. Occidental Petroleum sustains its billion-dollar earnings with a business model that emphasizes long-lived assets with long-term growth potential. They satisfy this model with their chemical sector of oil and gas. Operating in thirty-five countries, OXY continues to lead in the oil & gas exploration and production industry in cash flow per barrel.[1] This amounts to sizeable cash flows that exceed their typical expenses.[2] Furthermore, Occidental measures their success by their ability to maintain below-average debt levels, deliver returns in excess of its cost of capital and by achieving top quartile performance in relation to its peers.[3] Having developed strong