Derivatives (Tables)

6 Months Ended

Jun. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of outstanding cash flow hedges

The following U.S. Treasury rate locks were outstanding as of June 30, 2019 (in millions):

Treasury tenor	Notional value		Weighted Average Fixed Rate		Expiration Date	Unrealized loss included in other comprehensive income		Liability (a)
10-year	$	750	2.11	%	September 30, 2019	$	7	$	7
30-year	$	750	2.59	%	September 30, 2019	$	11	$	11

(a) The total $18 million liability is considered a Level 2 fair value measurement and is included in current liabilities - accrued liabilities as of June 30, 2019.

Summary of net sales related to the outstanding commodity derivative instruments

The following table summarizes the amounts reported in net sales related to the outstanding commodity derivatives not designated as hedging instruments as of June 30, 2019, and December 31, 2018.

(in millions, except Long/(Short) volumes)	2019			2018
Unrealized gain (loss) on derivatives not designated as hedges
Crude Oil Commodity Contracts	$	(24	)	$	184
Natural Gas Commodity Contracts	$	5		$	5
Outstanding net volumes on derivatives not designated as hedges
Crude Oil Commodity Contracts
Volume (MMBL)	54			61
Natural Gas Commodity Contracts
Volume (Bcf)	(155		)	(142		)

Gross and net fair values of outstanding derivatives

The following tables present the gross and net fair values of Occidental’s outstanding derivatives:

As of June 30, 2019		Fair Value Measurements Using						Netting (b)			Total Fair Value
(in millions)	Balance Sheet Location	Level 1		Level 2		Level 3
Assets:
Derivatives not designated as hedges (a)
Commodity Contracts	Other current assets	$	1,053	$	85	$	—	$	(1,105	)	$	33
	Long-term receivables and other assets, net	$	24	$	10	$	—	$	(24	)	$	10
Liabilities:
Derivatives not designated as hedges (a)
Commodity Contracts	Accrued liabilities	$	1,076	$	89	$	—	$	(1,105	)	$	60
	Deferred credits and other liabilities - other	$	25	$	1	$	—	$	(24	)	$	2

(a) Fair values are presented at gross amounts, including when the derivatives are subject to master netting arrangements, and presented on a net basis in the consolidated condensed balance sheets.

(b) These amounts do not include collateral. As of June 30, 2019, no collateral received has been netted against derivative assets and collateral paid of $19 million has been netted against derivative liabilities. Occidental had $43 million of initial margin deposited with brokers as of June 30, 2019. Initial margin is included in other current assets in the consolidated condensed balance sheets and has not been reflected in these derivative fair-value tables.

As of December 31, 2018		Fair Value Measurements Using						Netting (b)			Total Fair Value
(in millions)	Balance Sheet Location	Level 1		Level 2		Level 3
Assets:
Derivatives not designated as hedges (a)
Commodity Contracts	Other current assets	$	2,531	$	110	$	—	$	(2,392	)	$	249
	Long-term receivables and other assets, net	$	5	$	9	$	—	$	(6	)	$	8
Liabilities:
Cash-flow hedges(a)
Commodity contracts	Accrued liabilities	$	—	$	2	$	—	$	—		$	2
Derivatives not designated as hedges (a)
Commodity contracts	Accrued liabilities	$	2,357	$	101	$	—	$	(2,392	)	$	66
	Deferred credits and other liabilities - other	$	6	$	2	$	—	$	(6	)	$	2

(a) Fair values are presented at gross amounts, including when the derivatives are subject to master netting arrangements and presented on a net basis in the consolidated condensed balance sheets.

(b)

These amounts do not include collateral. As of December 31, 2018, $45 million collateral received has been netted against derivative assets and collateral paid of $1 million has been netted against derivative liabilities. Occidental had $178 million of initial margin deposited with brokers as of December 31, 2018. Initial margin is included in other current assets in the consolidated condensed balance sheets and has not been reflected in these derivative fair-value tables.

Summary of Derivative Instruments

Summary July 2019 derivative instruments
2020 Settlement
Three-way collars (Oil MBBL/day)			300
	Average price per barrel (Brent oil pricing)
		Ceiling sold price (call)	$	74.09
		Floor purchased price (put)	$	55.00
		Floor sold price (put)	$	45.00
2021 Settlement
Call Options sold (Oil MBBL/day)			300
	Average price per barrel (Brent oil pricing)
		Ceiling sold price (call)	$	74.09