Occidental Petroleum Corp. (NYSE:OXY)

Current Ratio

The current ratio demonstrated moderate fluctuations over the observed periods. Initially, it increased from 1.17 at the end of Q1 2021 to a peak of 1.34 in Q2 2021, suggesting improved short-term liquidity. Following this, the ratio experienced a declining trend with minor variations, reaching a low near 0.92 in both Q3 and Q4 of 2023. Beginning in early 2024, there was a gradual recovery back to just above 1.0 by mid-2025. Overall, the current ratio oscillated around the 1.0 benchmark, indicating a generally stable but slightly cautious liquidity position in recent quarters.

Quick Ratio

The quick ratio exhibited more pronounced volatility compared to the current ratio. After a rise from 0.62 in Q1 2021 to 0.84 in Q1 2022, the ratio declined steadily, hitting a significant trough of 0.45 in Q2 2023, which indicates reduced ability to cover current liabilities with more liquid assets. From mid-2023 onwards, the quick ratio showed a consistent upward trajectory, reaching 0.75 by Q2 2025. This pattern suggests that while liquidity had weakened, efforts to improve the immediacy of liquid assets relative to liabilities were effective in the latter part of the timeframe.

Cash Ratio

The cash ratio was the most variable and consistently below both the current and quick ratios, reflecting a relatively low proportion of cash and cash equivalents relative to current liabilities. It started at 0.26 in Q1 2021, peaked sharply at 0.48 in Q2 2021, and then declined, reaching a low of 0.07 in Q2 and Q3 2023. Subsequently, the ratio gradually recovered to 0.27 by mid-2025. The low cash ratio values indicate a conservative cash position, with the periodic increases suggesting periodic strengthening of immediate liquidity buffers.

The analysis of the quarterly data reveals noteworthy trends in the company's liquidity over the examined periods. Current assets generally fluctuate with no consistent upward or downward trajectory, reaching a peak around mid-2024 before experiencing a slight decline toward mid-2025. Current liabilities, on the other hand, display a variable pattern with periodic increases and decreases, peaking notably at the end of 2023 and again in mid-2024, followed by a reduction in mid-2025.

The current ratio, which measures the company's ability to cover short-term liabilities with short-term assets, exhibits a declining tendency from early 2021 through 2023. Starting above 1.1, the ratio gradually decreases, dipping below 1.0 during 2023, indicating periods where current liabilities exceeded current assets, thus suggesting potential liquidity pressures. However, from late 2023 onward, the current ratio shows a slight recovery, returning above 1.0 by mid-2025, which may reflect improved short-term financial stability.

Current Assets

The value of current assets shows cyclical movements without a definitive long-term trend, starting near 10 billion USD in early 2021, decreasing significantly throughout 2022 and 2023, before rising again in early to mid-2024. This volatility suggests shifts in inventory levels, receivables, or cash equivalents that affect liquidity.

Current Liabilities

Current liabilities follow a fluctuating path, with substantial increases during some quarters, particularly at the end of 2023 and mid-2024. These increases may be attributable to short-term borrowings or accruals rising, posing higher obligations within the current period.

Current Ratio

The current ratio declines from 1.17 in early 2021 to as low as 0.92 in late 2023, indicating deterioration in the company's short-term solvency. A ratio under 1.0 generally signals potential risks in covering short-term debts. The ratio improves slightly in subsequent quarters, reaching 1.05 by mid-2025, which may indicate better liquidity management or improved asset levels relative to liabilities.

Overall, the data suggests that the company experienced some liquidity challenges during 2023, with current liabilities occasionally surpassing current assets. However, there are signs of gradual recovery in short-term financial health beginning in late 2023 and continuing into 2025. Continuous monitoring of these indicators is advisable to ensure sustained liquidity and operational flexibility.

Quick Assets and Current Liabilities Trends

Over the analyzed periods, total quick assets exhibited some volatility with notable peaks and troughs. Beginning at $5,316 million in the first quarter of 2021, quick assets increased significantly to a high of $7,857 million in the second quarter of 2021, before declining to a low near $3,336 million by the second quarter of 2023. Subsequently, a recovery phase occurred, with quick assets gradually rising again to approximately $6,878 million by the first quarter of 2025.

Current liabilities followed a somewhat fluctuating pattern, starting at $8,631 million in the first quarter of 2021 and reaching highs in the range of $9,700 million during mid to late 2024. A decline toward $8,564 million was observed by the second quarter of 2025. Despite fluctuations, liabilities remained generally within the $8,300 million to $9,700 million band.

Quick Ratio Analysis

The quick ratio, representing short-term liquidity, showed substantial variation over the timeframe. Starting at 0.62 in March 2021, it improved to a peak of 0.84 by December 2021 and March 2022, indicating enhanced liquidity during that phase. Subsequently, the ratio declined steadily, reaching a low of 0.45 by June 2023, which may reflect increasing short-term liquidity pressures or a reduction in liquid assets relative to liabilities.

From mid-2023 onward, the quick ratio displayed a recovery trend, rising gradually to 0.75 by June 2025. This improvement suggests strengthening liquidity conditions, though the ratio did not return to the earlier peak levels seen in 2021 and early 2022 periods.

Overall Liquidity Insights

The observed trends imply that the company experienced cycles of liquidity tightening and easing. Strong liquidity was evident in late 2021 and early 2022, but this was followed by weaker liquidity positions through mid-2023. The recovery phase after this period indicates a possible strategic focus on improving short-term financial health.

Despite fluctuations, current liabilities have remained relatively stable within a narrow range, while the changes in quick assets have predominantly driven movements in the quick ratio. This suggests a primary influence of asset liquidity management on the company’s ability to meet short-term obligations.

Concluding Remarks

The overall analysis of financial liquidity metrics reveals important fluctuations likely tied to operational or market conditions impacting liquid assets. The improving quick ratio in recent periods is a positive indicator, but the values suggest ongoing attention may be necessary to maintain sufficient liquidity buffers relative to current liabilities.

The analysis of the quarterly financial data over the observed periods reveals several notable trends concerning the company's liquidity and short-term financial position.

Total Cash Assets

There is a significant fluctuation in total cash assets over the quarters. Initially, cash assets rose sharply from 2,270 million US dollars in the first quarter of 2021 to a peak of 4,569 million in the second quarter of 2021, followed by a considerable decline reaching as low as 486 million by the middle of 2023. After this low, cash assets showed a general recovery trend, increasing steadily through 2024 and early 2025, reaching 2,612 million before slightly decreasing to 2,326 million in the second quarter of 2025. Overall, this indicates volatile cash holdings with periods of rapid accumulation and depletion.

Current Liabilities

Current liabilities exhibit more stability compared to cash assets, though some variability is present. Starting at 8,631 million in early 2021, liabilities increased to a high of 9,730 million in the middle of 2022, followed by a gradual decline until early 2023. Thereafter, liabilities fluctuate modestly, oscillating around the 9,000 million mark with a notable decrease to 8,564 million by mid-2025. The liabilities pattern suggests relatively consistent short-term obligations with some cyclical variations.

Cash Ratio

The cash ratio, representing the proportion of cash assets relative to current liabilities, mirrors the trends observed in total cash assets. Starting at 0.26 in the first quarter of 2021, the ratio peaked at 0.48 during the second quarter of 2021, reflecting high liquidity during this period. Subsequently, the ratio declined sharply, reaching a low of approximately 0.07 in the middle and late 2023, indicating a tightened liquidity position. From early 2024 onwards, the cash ratio has shown a recovery trend, gradually increasing to 0.27 by mid-2025, suggesting an improvement in the company's short-term financial strength.

In summary, the data depicts a company experiencing considerable volatility in its cash position and liquidity over the analyzed quarters, with occasional pressures on its ability to cover current liabilities fully with cash assets. However, there is a positive trajectory in liquidity emerging in the recent quarters, implying improved cash management or operational performance supporting enhanced financial flexibility.