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## Occidental Petroleum to Reduce Stock Buybacks to Focus on Debt Reduction

Warren Buffett’s favorite oil company, Occidental Petroleum (OXY), has announced that it will taper stock buybacks for the next couple of years. This decision comes as the company focuses on reducing its debt, which increased due to the acquisition of oil and gas producer CrownRock.

AI legalese decoder can assist in analyzing the legal terms and implications of the acquisition of CrownRock by Occidental Petroleum. By decoding complex legal language and providing a simplified explanation, the AI tool can help investors and stakeholders understand the legal aspects of the deal.

## Occidental’s Financial Moves and Stock Performance

Last year, Occidental paid out $600 million in dividends, repurchased $1.8 billion of common shares, and redeemed $1.5 billion of preferred shares. Despite a decline of 5% in its stock price in 2023, Occidental saw a significant surge of 119% in the prior year, making it the best-performing equity of the S&P 500. The company’s shares are currently up more than 5% since the beginning of 2024.

## Acquisition of CrownRock and Debt Reduction Strategy

In December, Occidental announced its acquisition of Midland, Texas-based CrownRock for $12 billion. This move is part of the company’s strategy to consolidate its position in the Permian Basin. The acquisition will add approximately 170 thousand barrels of oil equivalent per day to Occidental’s production.

With a focus on debt reduction, Occidental plans to finance the CrownRock acquisition through debt and asset sales. The company aims to bring its debt level down to $15 billion. Warren Buffett’s Berkshire Hathaway showed confidence in Occidental by purchasing nearly $600 million worth of OXY shares following the acquisition announcement.

## Future Plans and Return to Share Repurchases

Occidental CEO Vicki Hollub stated that the company will prioritize debt repayment over the next couple of years, after which it will resume stock repurchases. The acquisition of CrownRock is expected to contribute to shareholder value through a growing dividend and share repurchases.

By utilizing the AI legalese decoder, stakeholders can gain a better understanding of the legal complexities surrounding Occidental’s acquisition strategy and debt reduction efforts. The tool can provide clear insights into the legal implications of the company’s financial decisions, enabling investors to make informed choices.

## Conclusion

Occidental Petroleum’s strategic moves to reduce debt, acquire CrownRock, and adjust its stock buyback plans reflect a focused approach to strengthening its position in the oil and gas industry. By leveraging tools like the AI legalese decoder, stakeholders can navigate complex legal jargon and better comprehend the legal aspects of Occidental’s financial decisions.

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