AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 3/6 · 18/10/2026
Moat31
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 1/4 · Realized efficiencies and pipeline ownership support operating competitiveness, but no comparative cost leadership or protected infrastructure economics are demonstrated. Indexed commodity sales provide direct evidence of limited product differentiation in pricing.
durability · 1/4 · Captured synergies improve the cost base, but their persistence relative to rivals is unproven. Normal field decline requires replenishment, while the additional savings program remained prospective at the latest filing.
customer dependency · 1/4 · Long-term LNG contracts create some demand continuity, but indexed commodity sales do not demonstrate customer dependence on ConocoPhillips or material switching friction. The LNG evidence is historical and covers only part of the business.
erosion resilience · 2/4 · Achieved efficiencies and substantial operating cash generation provide buffers, but external commodity prices and field depletion continue to determine economics. This is demonstrated operating resilience with limited evidence of structural protection.
Pricing power38
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 1/4 · Second-quarter 2026 realized oil prices rose with industry prices, while gas realizations fell 38%. First-quarter total realizations fell despite higher commodity prices, and 2024 average realizations also declined. Observed outcomes demonstrate fragile market-dependent pricing rather than durable company-controlled premiums.
retention · 2/4 · Producing LNG volumes sold primarily under long-term contracts support repeat demand through contractual continuity. This is indirect retention evidence from a historical segment disclosure; current renewals and company-wide customer persistence are not established.
margin resilience · 2/4 · Lower operating expenses and positive, improved first-half 2026 earnings demonstrate a meaningful cost buffer. Higher oil prices contributed materially, however, and disclosed external price dependence prevents attributing this result to pricing protection through a downturn.
contractual freedom · 1/4 · Sales generally occur at prevailing market prices, and principal liquids contracts use market indices adjusted for location, quality and transportation. These arrangements permit commercial adjustments but demonstrate little discretion to set prices independently of commodity markets.
Predictability—
Missing exact annual revenue, free cash flow or FCF margin; operating cash flow and capex must both be reported for all five years.
Financial strength—
Missing required inputs: debtFcfGrade. Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- netDebtEbitGrade
- 74.91
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 43.79
- Net debt / operating income (x)
- 1.25
- Current ratio (x)
- 1.30
Capital allocation—
Missing required inputs: cashConversionGrade. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 21.48
- 3-year average dilution (%)
- -0.46
- 3-year average SBC / revenue (%)
- 0.63
Management75
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 3/4 · First-half 2026 operating cash flow of $11.729 billion covered $5.972 billion of capital expenditures and investments plus $5.063 billion of repurchases and dividends. Debt declined modestly, and the disposition target was reported achieved ahead of schedule. Acquisition-related share issuance tempers the assessment; repurchases alone do not establish value creation.
incentive alignment · 3/4 · Existing incentives use three-year relative TSR and relative/absolute Adjusted ROCE, alongside prohibitions on hedging and pledging. The disclosure links a below-target performance period to reduced expected awards, providing evidence beyond compensation philosophy. Committee discretion remains, and executive ownership is not established.
execution · 3/4 · Reported captured synergies, realized Lower 48 efficiencies and completion of the disposition target ahead of schedule demonstrate execution. These are disclosed achievements and operating evidence, not an inference from CEO reputation. Future savings, Iraq redevelopment and LNG expansion are not counted as completed outcomes.
governance · 3/4 · Disclosed independent directors and key committees, required executive sessions and an unqualified external internal-control opinion support strong oversight structures. Combined Chairman and CEO roles limit separation of authority; the evidence does not establish exceptional governance effectiveness or future election outcomes.
Evidence
Additional increases to earnings include lower production and operating expenses of $341 million, primarily driven by efficiencies.
Results of Operations—Lower 48, first-half expense efficiencies · Filed 06/08/2026
We captured more than $1 billion of synergies and approximately $1 billion of additional one-time benefits, while still delivering pro forma production growth.
Proxy introductory letter—reported acquisition synergies and one-time benefits · Filed 30/03/2026
In the second half of 2025, we announced incremental cost reductions and margin enhancements exceeding $1 billion anticipated on a run-rate basis by year-end 2026, reflecting continued progress toward delivering sustainable improvements in our cost structure and margins.
Management’s Discussion and Analysis—prospective cost reductions and margin enhancements · Filed 06/08/2026
Our earnings and operating cash flows generally correlate with price levels for crude oil and natural gas, which are subject to factors external to the company and over which we have no control.
Management’s Discussion and Analysis—external commodity-price exposure · Filed 06/08/2026
Production decreases were primarily driven by normal field decline and dispositions of assets in 2025.
Results of Operations—normal field decline and dispositions · Filed 30/04/2026
•Competition and consolidation in the oil and gas E&P industry, including competition for sources of supply, services, personnel and equipment.
Forward-looking risk disclosures—competition for operating inputs · Filed 06/08/2026
New or more stringent permitting, disclosure or other regulatory requirements on hydraulic fracturing or other oil and natural gas operations, including subsurface water disposal, could result in increased costs, operating restrictions or operational delays or could limit the ability to develop oil and natural gas resources.
Risk Factors—potential regulatory costs and development restrictions · Filed 17/02/2026
Commodity sales are generally made at prevailing market prices at the time of sale.
Business—prevailing-market-price commodity sales · Filed 17/02/2026
These commodities are primarily sold under contracts with prices based on market indices, adjusted for location, quality and transportation.
Business—index-based crude oil, bitumen and NGL contracts · Filed 17/02/2026
Three Months Ended June 30 Industry Prices 2026 2025 Change Brent ($ per BBL) 104.52 67.82 54 % WTI ($ per BBL) 92.79 63.74 46 % Henry Hub ($ per MMBTU) 2.90 3.44 (16) % Average Realized Prices Crude ($ per BBL) 99.40 64.23 55 % Bitumen ($ per BBL) 61.01 39.43 55 % Gas ($ per MCF) 2.58 4.16 (38) % Total ($ per BOE) 62.33 45.77 36 % Oil and bitumen prices were higher in the second quarter of 2026 compared with the same period of 2025 as Middle East supply disruptions that began in the first quarter of 2026 persisted through the second quarter.
Management’s Discussion and Analysis—second-quarter 2026 benchmark and realized prices · Filed 06/08/2026
Total realized prices were lower in the first quarter of 2026 compared to the same period of 2025 despite increased commodity prices, primarily due to lower realized gas prices in the Permian.
Management’s Discussion and Analysis—first-quarter realized-price weakness · Filed 30/04/2026
We have producing equity LNG facilities located in Australia and Qatar, by which volumes are primarily sold under long-term contracts with prices based on market indices.
Business—producing equity LNG facilities and long-term indexed sales contracts · Filed 15/02/2024
Financial Information Item 1. Financial Statements Consolidated Income Statement ConocoPhillips Millions of Dollars Three Months Ended June 30 Six Months Ended June 30 2026 2025 2026 2025 Revenues and other income Sales and other operating revenues $ 19,161 14,004 34,922 30,521 Equity in earnings of affiliates 239 315 486 707 Gain (loss) on dispositions 14 317 19 396 Other income 108 104 149 217 Total revenues and other income 19,522 14,740 35,576 31,841 Costs and expenses Purchased commodities 6,712 5,085 12,995 11,273 Production and operating expenses 2,431 2,572 4,707 5,078 Selling, general and administrative expenses 188 250 381 441 Exploration expenses 75 81 184 198 Depreciation, depletion and amortization 2,983 2,838 5,889 5,584 Impairments 2 1 21 2 Taxes other than income taxes 793 572 1,400 1,123 Accretion on discounted liabilities 99 95 196 189 Interest and debt expense 182 232 380 437 Foreign currency transaction (gain) loss (25) (3) (25) 27 Other expenses — — 3 6 Total costs and expenses 13,440 11,723 26,131 24,358 Income (loss) before income taxes 6,082 3,017 9,445 7,483 Income tax provision (benefit) 2,151 1,046 3,331 2,663 Net income (loss) $ 3,931 1,971 6,114 4,820 Net income (loss) per share of common stock (dollars) Basic $ 3.23 1.56 5.00 3.80 Diluted 3.23 1.56 5.00 3.79 Weighted-average common shares outstanding (in thousands) Basic 1,213,453 1,257,512 1,218,715 1,265,387 Diluted 1,214,255 1,258,998 1,219,492 1,266,815 See Notes to Consolidated Financial Statements.
Consolidated Income Statement—first-half 2026 operating results · Filed 06/08/2026
ConocoPhillips 2026 Q2 10-Q 4 Financial Statements Table of Contents Consolidated Statement of Cash Flows ConocoPhillips Millions of Dollars Six Months Ended June 30 2026 2025 Cash flows from operating activities Net income (loss) $ 6,114 4,820 Adjustments to reconcile net income (loss) to net cash provided by operating activities Depreciation, depletion and amortization 5,889 5,584 Impairments 21 2 Dry hole costs and leasehold impairments 56 85 Accretion on discounted liabilities 196 189 Deferred taxes 149 78 Distributions more (less) than income from equity affiliates 110 (112) (Gain) loss on dispositions (19) (396) Other 47 (62) Working capital adjustments Decrease (increase) in accounts and notes receivable (1,085) 973 Decrease (increase) in inventories (19) (84) Decrease (increase) in prepaid expenses and other current assets (288) (229) Increase (decrease) in accounts payable 331 (27) Increase (decrease) in taxes and other accruals 227 (1,221) Net cash provided by operating activities 11,729 9,600 Cash flows from investing activities Capital expenditures and investments (5,972) (6,664) Working capital changes associated with investing activities 154 551 Proceeds from asset dispositions 190 1,341 Net sales (purchases) of investments (652) (8) Other (39) (27) Net cash used in investing activities (6,319) (4,807) Cash flows from financing activities Repayment of debt (175) (806) Issuance of company common stock (39) (55) Repurchase of company common stock (3,006) (2,722) Dividends paid (2,057) (1,982) Other (79) (55) Net cash used in financing activities (5,356) (5,620) Effect of exchange rate changes on cash, cash equivalents and restricted cash (5) 148 Net change in cash, cash equivalents and restricted cash 49 (679) Cash, cash equivalents and restricted cash at beginning of period 6,916 5,905 Cash, cash equivalents and restricted cash at end of period $ 6,965 5,226 Restricted cash of $65 million is included in the "Prepaid expenses and other current assets" line of our Consolidated Balance Sheet at December 31, 2025.
Consolidated Statement of Cash Flows—capital spending, distributions and financing · Filed 06/08/2026
ConocoPhillips 2026 Q2 10-Q 30 Management’s Discussion and Analysis Table of Contents Key Operating and Financial Summary •Reported second-quarter 2026 earnings per share of $3.23; •Generated cash provided by operating activities of $7.4 billion; •Distributed $3.0 billion to shareholders, including $2.0 billion through share repurchases and $1.0 billion through the ordinary dividend; •Declared third-quarter ordinary dividend of $0.84 per share; •Reaffirmed full-year guidance items; •Delivered total company and Lower 48 production of 2,248 MBOED and 1,479 MBOED, respectively; •Signed agreements to sell noncore Lower 48 assets for $1.7 billion, which closed in July, achieving $5 billion disposition target ahead of schedule; •Signed an agreement to acquire a 42% interest in a joint venture in the Kirkuk area of northern Iraq, accessing long-life, conventional redevelopment opportunities at an attractive entry cost and competitive cost of supply; closing expected by year-end 2026; •Executed an agreement for re-entry into Syria, leveraging existing infrastructure to restore and increase production at onshore fields; •Advanced commercial LNG strategy with additional 2 MTPA of offtake agreements, bringing total LNG offtake to 12 MTPA; and •Ended the quarter with cash, cash equivalents and restricted cash of $7.0 billion, short-term investments of $1.1 billion and long-term investments of $1.2 billion.
Key Operating and Financial Summary—completed dispositions, production and prospective investments · Filed 06/08/2026
43 ConocoPhillips 2026 Q2 10-Q Capital Resources and Liquidity Table of Contents Capital Resources and Liquidity Financial Indicators Millions of Dollars June 30 2026 December 31 2025 Cash and cash equivalents $ 6,574 6,497 Short-term investments 1,118 484 Short-term debt 462 1,020 Total debt 23,290 23,444 Total equity 65,349 64,487 Percent of total debt to capital* 26 % 27 Percent of floating-rate debt to total debt 1 % 1 *Capital includes total debt and total equity.
Capital Resources and Liquidity—debt, cash and capitalization · Filed 06/08/2026
1-Year Absolute Adjusted ROCE Note: As discussed under “Components of Executive Compensation — Performance-Based Pay Programs” on page 72, the HRCC evaluates performance for purposes of PSP payouts using relative TSR and relative/absolute Adjusted ROCE measured over a three-year performance period because a multiyear performance period helps to focus management on longer-term results.
Pay Versus Performance—three-year TSR and Adjusted ROCE performance measures · Filed 30/03/2026
No pledging, hedging, short sales or derivative transactions, and no repricing of stock options.
Executive compensation practices—hedging, pledging and repricing prohibitions · Filed 30/03/2026
The dividend equivalents granted in 2025 for 2023 PSP awards vesting and settling in 2026 are adjusted for actual below-target performance because that is the probable payout based on performance through the end of the performance period (ended December 31, 2025) even though the HRCC retained the discretion to adjust the payout until the time of settlement in February of 2026.
Compensation Actually Paid reconciliation—below-target performance and payout discretion · Filed 30/03/2026
The Board consists of 11 independent directors.
Corporate Governance—independent director count · Filed 30/03/2026
Furthermore, each of the Audit and Finance, Human Resources and Compensation, and Directors’ Affairs committees is made up entirely of independent directors.
Corporate Governance—independent committee membership · Filed 30/03/2026
Our Corporate Governance Guidelines require our Lead Director to preside over an executive session of the non-employee directors at every meeting.
Corporate Governance—required non-employee director executive sessions · Filed 30/03/2026
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 17, 2026 expressed an unqualified opinion thereon.
Independent auditor report—unqualified internal-control opinion · Filed 17/02/2026
Lance was appointed Chairman and Chief Executive Officer in May 2012, having previously served as Senior Vice President, Exploration and Production — International since May 2009.
Director biography—combined Chairman and CEO roles · Filed 30/03/2026
ConocoPhillips common stock was issued and exchanged for outstanding Marathon Oil shares.
Capital Resources and Liquidity—shares issued for acquisition · Filed 18/02/2025
We have a 35.1 percent ownership interest in the Norpipe Oil Pipeline System, a 220-mile pipeline which carries crude oil from Ekofisk to a crude oil stabilization and NGLs processing facility in Teesside, U.K.
Business and Properties—Norpipe Oil Pipeline System ownership · Filed 17/02/2026
Our worldwide annual average realized price decreased six percent from $58.39 per BOE in 2023 to $54.83 per BOE in 2024 primarily due to lower crude and natural gas prices.
Management’s Discussion and Analysis—2024 realized-price decline · Filed 18/02/2025
Compensation Reference Group • 3M • APA Corporation* • Bristol-Myers Squibb • Caterpillar • Chevron* • Cummins • Devon Energy* • EOG Resources* • ExxonMobil* • General Dynamics • Halliburton* • Honeywell • Lockheed Martin • Marathon Petroleum* • Merck • Northrop Grumman • Occidental Petroleum* • Pfizer • Phillips 66* • RTX • SLB* • Valero Energy* * Energy industry companies Mercer gathers and performs an analysis of market data for each NEO, comparing each of their individual components of compensation, as well as total compensation, to that of the compensation reference group.
Compensation Discussion and Analysis—compensation reference group · Filed 30/03/2026
