A headquarters of Occidental Petroleum. Photo: Jay L. Clendenin/Los Angeles Times via Getty Images

Occidental Petroleum, a huge U.S.-based oil producer, posted an $8.35 billion second-quarter loss Monday afternoon as it took huge write-downs on its asset values.

Why it matters: The whole industry is under pressure, but Occidental's problems are compounded by the additional debt it assumed when it beat out Chevron to acquire Anardarko in 2019.

By the numbers: The Houston-based company announced a $6.6 billion write-down, including a $4.3 billion hit to the value of its U.S. onshore acreage

  • While multiple companies are taking multibillion dollar write-downs amid forecasts of continued weak prices and demand, Bloomberg notes that Occidental's is among the largest relative to its size.

What they're saying: "We remain concerned about the company's high debt load and ability to generate cash flow in a prolonged low oil price environment," Jennifer Rowland, an analyst with Edward Jones, writes in a note.

Yes, but: The company touted its various steps to weather the storm and manage debt, including an over 50% cut to its 2020 capital budget down to the $2.4 billion to $2.6 billion range and over $2 billion in asset sales.

  • “We continue to make progress on our debt structure and have significantly exceeded our cost savings targets while delivering operational excellence across our business," CEO Vicki Hollub said in a statement.

Go deeper

Ben Geman, author of Generate
Aug 19, 2020 - Energy & Environment

Occidental Petroleum teams with private equity firm to deploy carbon capture tech in U.S.

Image courtesy of Carbon Engineering

Occidental Petroleum has teamed up with Rusheen Capital Management to advance plans by Canada-based Carbon Engineering to build a direct air capture plant in the Permian Basin — and eventually facilities elsewhere, too.

Why it matters: It's a step toward building a plant that the companies say would be the world's largest direct air capture (DAC) facility, with the capacity to remove up to 1 million metric tons of atmospheric CO2 annually.

Dion Rabouin, author of Markets
Aug 20, 2020 - Economy & Business

Why the dollar matters

Illustration: Sarah Grillo/Axios

The value of the dollar has sunk to its weakest level in two years and investors are warning that a prolonged slide could be in store for the U.S. currency, leading to more of the world abandoning the dollar and the U.S. losing its "exorbitant privilege."

Why it matters: The dollar's status as the world's reserve currency has been in place since the end of World War II and provides the backbone for the U.S. economy and fiscal policy.

How "naked ballots" could upend mail-in voting in Pennsylvania

Trump signs in Olyphant, Penn. Photo: Eric Baradat/AFP via Getty Images

Pennsylvania's Supreme Court ordered state officials last week to throw out mail-in ballots submitted without a required inner "secrecy" envelope in November's election, the Philadelphia Inquirer reports.

The state of play: The decision went under the radar alongside the simultaneous decision to extend the time that mail-in ballots could be counted, but Philadelphia's top elections official warned state legislators this week that throwing out so-called "naked ballots" could bring "electoral chaos" to the state and cause "tens of thousands of votes" to be thrown out — potentially tipping the presidential election.

Get Axios AM in your inbox

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Subscription failed
Thank you for subscribing!