Oil and gas major Occidental Petroleum (OXY) is seeking to sell its chemical subsidiary, OxyChem, in a deal valued at about $10 billion as part of its efforts to reduce debt, according to the Financial Times. The news could bring OXY stock into the spotlight when markets open Monday morning, due to the high price tag.
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The Warren Buffett-backed company is reportedly working with advisors on a potential sale, which would create one of the world’s largest independent petrochemicals unit. The divestment is expected to be announced in the coming weeks, provided there are no last-minute hurdles.
OXY Is Set on a Debt Reduction Drive
A potential multi-billion-dollar deal could help Occidental reduce the heavy debt it took on from past acquisitions, including the $55 billion purchase of Anadarko Petroleum in 2019 and the $12 billion purchase of CrownRock in 2023. As of June 30, 2025, the company’s long-term debt stood at $23.34 billion. Since announcing the CrownRock deal in late 2023, Occidental has already sold more than $4 billion in assets and paid down $7.5 billion in debt.
Selling the OxyChem unit would allow the company to go well beyond its original goal of raising $4.5 to $6 billion through asset sales after the CrownRock acquisition. This move also follows a series of divestitures, including the recent sale of four Permian Basin development assets in August 2025.
Ongoing Challenges in the Petrochemical Market
Occidental’s decision comes at a challenging time for petrochemical producers. Industry profits have declined due to oversupply from new capacity in the U.S. and Middle East, coupled with increased output from China. Several companies have already implemented large-scale layoffs as a result of these pressures.
Meanwhile, the oil and gas industry is also struggling with a prolonged drop in oil prices. OXY stock has lost 2.4% year-to-date, while rival Chevron (CVX) has surged more than 14% and ExxonMobil (XOM) has gained nearly 12%.
Is OXY Stock Good to Buy?
Despite debt reduction progress, analysts remain cautious on Occidental’s long-term outlook. On TipRanks, OXY stock has a Hold consensus rating based on two Buys, 14 Holds, and two Sell ratings. The average Occidental Petroleum price target of $49.47 implies 4.2% upside potential from current levels.
