Is Occidental Petroleum Stock A Good Fit For Your Portfolio?
Investors holding Occidental Petroleum (OXY) stock most likely carry it alongside funds tracking the S&P 500. As an oil and gas producer, Occidental can either amplify existing market risks in a portfolio or provide a counterbalance. So what does Occidental stock do to the rest of your money when the market rises or falls?
Occidental Has Recently Climbed When The Index Fell
Over the past year, Occidental shares on average moved in the opposite direction of the broader market, a pattern that has held only since March 2026. Before that, and over five years, the stock mostly moved with the market. The S&P 500 gained 0.65% on an average positive day. By the close of those trading sessions, a $10,000 holding in Occidental lost about $30. Conversely, the index lost 0.6% on an average negative day, while that same Occidental holding gained about $67.
Reduced to a single metric, Occidental moved about 0.63% in the opposite direction for every 1% change in the index. Over the past year, the stock offset existing market risk rather than adding to it.
Yet Occidental carries significant risk on its own. The stock’s volatility, defined here as the size of its typical swings over a year, was 35.3% in the past twelve months. That compares to 13.0% for the S&P 500. Furthermore, the stock fell on each of the index’s three worst days of the past year. On the worst day, the S&P 500 fell 2.7%, and Occidental fell 5.3%.
Has Occidental Rewarded You For Its Swings?
Only partly. Occidental returned 15.6% a year over the past five years, slightly outpacing the 14.1% return of the S&P 500. Investors endured substantially larger price swings to secure that gain. The volatility of the stock over those five years was 37.9% a year, compared to 17.1% for the index.
Dividing the return by the volatility reveals how much return each unit of swing generated. Over the past five years, that calculation comes to 0.41 for Occidental and 0.82 for the S&P 500. Ultimately, Occidental’s price swings have paid about half as well as the broader market.
Is Occidental Still An Oil Price Bet?
Yes. Occidental still generates nearly all its revenue from producing oil and gas, so its stock remains tied to those prices. Those commodities brought in $20.9 billion of its $21.6 billion in fiscal 2025 revenue. During the fiscal Q2 2026 call on August 6, 2026, management stated that higher commodity prices had helped its free cash flow. The company also called the situation in the Middle East fluid, and it kept its goal of cutting principal debt to $10 billion but declined to set a further target because oil prices were volatile.
Management has reduced principal debt to $11.8 billion, marking its lowest level since the second quarter of 2019.
If the pattern of the past year holds, Occidental provides a minor drag on a portfolio when the market rises and offers a modest lift when it falls. That dynamic provides a benefit only if oil is not already a large component of your holdings. For investors who already own other oil and gas producers or an energy fund, Occidental simply adds to a bet on oil and gas prices that you have already made.
How To Act On OXY?
Now you know OXY better. And that’s our purpose: to make you informed before you invest your money. However, making a bet on a single stock carries its own risks.
There is a smarter choice. Since its inception, the Trefis High Quality (HQ) Portfolio has beaten the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking.
If you’d rather act on OXY itself:
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