Despite record oil prices, Occidental Petroleum Corp.’s earnings declined in the second quarter due to the seizure of assets by the country of Ecuador earlier this year.
The Los Angeles-based oil company reported second quarter net income of $857 million ($1.97 per share), down 44 percent from $1.54 billion ($3.77) in the same period a year earlier. Revenue jumped to $4.6 billion from $3.39 billion, topping most estimates of $4.48 billion, the company said.
Occidental recorded an after-tax loss of $347 million, which included a charge related to the end of its investment in Ecuador. The South American country began seizing Occidental’s oil in May when it terminated the company’s operating contract after accusing the company of illegally transferring oil assets without authorization. Ecuador is the continent’s fifth-largest oil producer. That loss offset gains the company saw from higher production and gas and oil prices in the quarter.
However, daily oil and gas production increased 18 percent from last year to 609,000 barrels. Higher prices also sent earnings from oil and gas sales up 56 percent to $1.9 billion for the quarter.
Shares of Occidental were down only 1 percent in Friday treading on the New York Stock Exchange to $105.16 a share.
