Occidental Petroleum produced plenty of oil and gas in the fourth quarter of 2012, but heavy investments in the future of business and giving investors pause.
Occidental Petroleum, still based in Los Angeles, is still the biggest domestic player in the oil and gas business. But look out below! The company posted a massive drop in profits for the fourth quarter of 2012.
As in really massive, down to $336 million from $1.6 billion in 2011 — nearly an 80 percent year-over-year plunge.
The decline was much bigger than Occidental’s third quarter slide of 20 percent. Some of the same problems are to blame: the cost of managing wells in California and heavy spending to improve the business.
Wall Street shrugged off the loss and pushed Oxy’s stock price higher in trading Thursday. And for what it's worth, Occidental set records for oil production in the quarter, continuing a trend.
But rumblings continue about whether the company should break apart its different businesses — and whether CEO Stephen Chazen, who took charge in 2011, is the right man for the job.
The Ford Escape has been a big sales success for Ford so far this year.
Prior to the financial crisis and the meltdown of the Detroit auto industry, Ford reliably sold hundreds of thousands of its full-size SUV, the Explorer, every year. The high water mark was 2002, when 433,847 of the vehicles were unleashed on happy consumers.
Since 2005, however, and with the end of the era of cheap gas (seemingly), Explorer sales have never climbed above 200,000.
The Ford Escape, a small SUV, is another story. Ford just released sales numbers for September, and the Escape is one of the highlights. The vehicle is on track to beat last year's sales of more than 250,000, which was itself a record.
In terms of volume, the only vehicle that did better in Ford's lineup was the F-Series — basically the F-150 pickup truck, America's best-selling vehicle for decades.
The Escape appears to be doing well for a couple of reasons. First, it got a design update for the 2013 model year, aligning it more closely with the look of the Explorer but also moving toward a new undergirding architecture that separates it from Escapes of the past and make it more of a small crossover.
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People stand near downed branches as Tropical Storm Isaac begins to move ashore. The storm is creating havoc in the heart of the U.S. refining business, adding additional pressure to force prices up.
That's about the size of it. According to GasBuddy.com, the average price of a gallon of regular is holding steady at just about $4.13 today, a week ahead of Labor Day.
This is about 2 cents higher than a week ago and confirmation that the fire at Chevron's Richmind refinery in the Bay Area a few weeks back has taken enough capacity offline to ensure that L.A. prices will remain above $4 a gallon.
But there are other problems in the world of gas refining and oil drilling. A fire hit a huge refinery in Venezuela over the weekend, and tropical storm Isaac is currently cutting a swath through the heart of the U.S. refining industry, the Gulf of Mexico. Numerous oil and gas suppliers and refiners have shut down their operations until the storm blows over.
All of this will push gas prices up nationally. They're risen about 25 cents since this time last month. But they haven't hit $4 yet. Los Angeles crossed that threshold a while ago because California law requires that our drivers burn a cleaner blend — one that isn't produced in significant volume outside the state.
Gas prices at a Chevron station in Pasadena. In Southern California, in the aftermath of Chevron's Richmond fire, prices could climb this high or higher in coming weeks.
The fire that broke out at Chevron's Richmond refinery last night is now under control, but the impact on gas prices in the California is just beginning. Even though the damage was done in the Bay Area, Southern California is likely to feel the impact. Here's a Q&A to explain the situation.
Q: How expensive is gas going to get in SoCal?
A: Analysts who follow the oil-and-gas markets have been reported predicting a spike of 25-40 cents this week, in a California market that's already paying a lot more for its gasoline than the rest of the country: $3.86 per gallon versus $3.63 for the rest of the U.S., according to AAA (via CNBC). Los Angeles drivers are paying even more than that: $3.93 per gallon. That's a ways off from the $5 per gallon peaks that we hit during the summer of 2008. But it still isn't pretty.
In the past, I've definitely tussled with what I think of as the "Bicycles Boys" — after a pre-"Sex and the City" story in the New York Observer by Candace Bushnell. You can sample the disagreement here, here, and here. These are smart gents who believe that the urban landscape can be remade, productively, in the image in of the cyclist.
I think they're starry eyed idealists.
But now the tables have been turned. As much as I love cars and driving — and continue to think that America is car country and there's really no changing that — I now live within easy biking distance of my office. The terrain is invitingly flat. And of course the weather in Southern California is nearly idea for a short daily commute by bike.
Also, I'm not getting any younger. I need daily exercise. So why not get it by biking to work?