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ConocoPhillips’s Crude Oil Price Realizations and WTI Crude Oil

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ConocoPhillips’s 3Q16 crude oil realized prices

Excluding the effect of hedges, ConocoPhillips’s (COP) Lower 48 average realized crude oil price in 3Q16 was $40.09 per barrel. That’s ~4.0% below $41.56 per barrel in 3Q15.

Sequentially, COP’s Lower 48 average realized crude oil price in 3Q16 was ~1.0% higher than 2Q16.

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Comparison with benchmark

COP’s Lower 48 average realized crude oil price in 3Q16 underperformed the average WTI crude oil price during the same period. Its average realized crude oil price in 3Q16 was ~11.0% lower than the average WTI crude oil price of $44.88 per barrel for the same period.

According to ConocoPhillips’s 10Q report for 3Q16, “The differential is driven primarily by local market dynamics in the Gulf Coast and Bakken, and may remain relatively wide in the near term.”

Natural gas realized prices

For 3Q16, COP’s Lower 48 average realized price for natural gas production fell ~2.0% to $2.59 per thousand cubic feet compared to $2.65 per thousand cubic feet for the same period in 2015.

For 3Q16, COP’s Lower 48 average realized price for natural gas liquids production rose ~16.0% to $14.57 per barrel compared to $12.55 for the same period in 2015.

Other upstream players

Other upstream companies from the S&P 500 (SPY) such as Southwestern Energy (SWN), Pioneer Natural Resources (PXD), and Marathon Oil (MRO) had lower realized crude oil prices in 3Q16 compared to the average WTI crude oil price during the same quarter.

Next, let’s take a look at an interesting graph that reveals how effective ConocoPhillips’s realized price is when compared to COP’s production costs.

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