Income Taxes

9 Months Ended

Sep. 30, 2012

Disclosure Text Block [Abstract]

Income Taxes

12.  Income Taxes

The following summarizes income tax expense (benefit) and effective tax rates:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
millions except percentages	2012			2011			2012			2011
Income tax expense (benefit)	$	248		$	(1,468)		$	764		$	(762)
Effective tax rate		64	%		33	%		25	%		25	%

The increase from the 35% U.S. federal statutory rate for thethree months ended September 30, 2012, was primarily attributable to foreign tax rate differentials and valuation allowances, Algerian exceptional profits taxes, and U.S. tax impact from losses and restructuring of foreign operations. The decrease from the 35% U.S. federal statutory rate for the nine months ended September 30, 2012, was primarily attributable to the resolution of the Algeria exceptional profits tax dispute. This amount was partially offset by foreign tax rate differentials and valuation allowances, Algerian exceptional profits taxes, andU.S. tax impact from losses and restructuring of foreign operations.

The Company reported a loss before income taxes for the three and nine months ended September 30, 2011. As a result, items that ordinarily increase or decrease the tax rate will have the opposite effect. The decrease from the 35% U.S. federal statutory rate for thethree and nine months ended September 30, 2011, was primarily attributable to Algerian exceptional profits taxes, U.S. tax on foreign income inclusions and distributions,and foreign tax rate differentials and valuation allowances.The decrease from the 35% U.S. federal statutory rate for the nine months ended September 30, 2011, was also attributable to items resulting from business acquisitions. These items were partially offset by the U.S. tax impact from losses and restructuring of foreign operations, state income taxes, and other items.