OCCIDENTAL PETROLEUM CORP /DE/

INCOME TAXES

Total deferred tax assets, after valuation allowance, were $2.6 billion and $2.4 billion as of December 31, 2025 and 2024, respectively. The Company expects to realize the recorded deferred tax assets, net of any allowances, through future operating income and reversal of temporary differences. The total deferred tax liabilities were $8.2 billion and $7.7 billion as of December 31, 2025 and 2024, respectively. See Note 9 - Income Taxes in the Notes to Consolidated Financial Statements in Part II Item 8 of this Form 10-K for additional details.

WORLDWIDE EFFECTIVE TAX RATE

The following table sets forth the calculation of the worldwide effective tax rate for income from continuing operations:

The Company’s worldwide effective tax rate in 2025, 2024 and 2023 was higher than the U.S. statutory rate of 21% and primarily driven by the Company’s jurisdictional mix of income from continuing operations, where international income is subject to tax at statutory rates as high as 55%. The reclassification of OxyChem, which is primarily domestic, to discontinued operations increased this impact.

LEGAL ENTITY REORGANIZATION

The IRS is currently reviewing the legal entity reorganization transaction as part of the Company’s 2022 federal tax audit. Following the acquisition of Anadarko and related divestitures, the Company reorganized its legal entities to better align with the nature of its business activities. This reorganization resulted in the Company making an adjustment to the tax basis in a portion of its operating assets, reducing deferred tax liabilities and recording a $2.7 billion tax benefit in 2022.

RECENT TAX LEGISLATION

The OBBBA was enacted on July 4, 2025 and introduced provisions expected to benefit the Company including accelerated depreciation for newly acquired and constructed assets, favorable adjustments to interest expense limitation, immediate deduction of research and development costs, and increased tax credit values for qualified CO 2 projects. In accordance with ASC 740, the financial statement impact of the OBBBA was recognized beginning in the third quarter of 2025.

The OECD Pillar Two initiative proposes to apply a 15% global minimum tax on multinational entities, applied on a jurisdiction-by-jurisdiction basis. Several countries, including European Union member states, Canada and Oman, have enacted or are in the process of enacting legislation aligned with all or portions of Pillar Two. The Company continues to monitor and assess the impact of new OECD Pillar Two administrative guidance and Pillar Two compliant legislation proposed or enacted in the jurisdictions in which the Company operates. Based on developments to date, the Company does not anticipate any significant impact on the Company’s results of operations or cash flows from the enactment of Pillar Two legislation.