ConocoPhillips

Industry regulation · Safety and environmental regulations

We expect to continue to incur substantial capital expenditures and operating costs as a result of our compliance with existing and future environmental laws and regulations. These laws and regulations continue to increase in both number and complexity and affect our operations with respect to, among other things: The handling, use, storage, transportation, disposal and cleanup of hazardous materials and hazardous and nonhazardous wastes; The dismantlement, abandonment and restoration of historic properties and facilities at the end of their useful lives.

Industry regulation · Regulatory compliance and changes

Our business is subject to numerous laws and regulations relating to the protection of the environment, which are expected to continue to have an increasing impact on our operations. These laws and regulations continue to increase in both number and complexity and affect our operations with respect to, among other things: Permits required in connection with exploration, drilling, production and other activities; The discharge of pollutants into the environment; Emissions into the atmosphere, such as nitrogen oxides, sulfur dioxide, mercury and GHG emissions.

Legal and litigation · Litigation and legal proceedings

Beginning in 2017 and continuing through 2025, cities, counties, governments and other entities in several states/territories in the U.S. have filed lawsuits against oil and gas companies, including ConocoPhillips, seeking compensatory damages and equitable relief to abate alleged climate change impacts. Additional lawsuits with similar allegations are expected to be filed by governmental entities.

Natural and catastrophic events · Terrorism and security threats

Our operations are subject to a variety of hazards and risks that require significant and continuous oversight, such as the monitoring, prevention or mitigation of or protection from explosions; fires; product spills; severe weather; geological events; global health crises, such as epidemics and pandemics; labor disputes; geopolitical tensions and escalations; armed hostilities; terrorist or piracy attacks; sabotage; civil unrest or cyberattacks.

Natural and catastrophic events · Natural disasters and extreme weather

Our operations are subject to a variety of hazards and risks that require significant and continuous oversight, such as the monitoring, prevention or mitigation of or protection from explosions; fires; product spills; severe weather; geological events; global health crises, such as epidemics and pandemics.

Geopolitical and trade · Regulatory and policy uncertainty

Existing and future laws, regulations and internal initiatives relating to global climate change, such as limitations on GHG emissions or provisions aimed at reducing such emissions, may impact or limit our business plans, result in significant expenditures, promote alternative uses of energy or reduce demand for our products. Continuing political and societal attention to the issue of global climate change has resulted in both existing and pending international agreements and national, regional or local legislation and regulatory measures to limit GHG emissions.

Social and demographic · Stakeholder activism and pressure

Attention to global climate change has also resulted in pressure from and upon stockholders, financial institutions and other financial market participants to potentially limit or discontinue investments, insurance and funding to oil and gas companies. For example, a significant number of financial institutions have pledged to meet the goal of net zero by 2050, as well as setting interim targets for 2030 or earlier.

Natural and catastrophic events · Pandemic and public health crises

Our operations are subject to a variety of hazards and risks that require significant and continuous oversight, such as the monitoring, prevention or mitigation of or protection from explosions; fires; product spills; severe weather; geological events; global health crises, such as epidemics and pandemics. Countermeasures to address global health crises, epidemics or pandemics may result in reduced demand for our products; disruptions to our supply chain, the global economy or financial or commodity markets.

Core operations · Facility damage and equipment failure

All such hazards could result in loss of human life, significant property and equipment damage, environmental pollution, impairment of operations, substantial losses to us and damage to our reputation.

Core operations · Operational disruption and business continuity

Our business and operations may be disrupted if we do not respond, or are perceived not to respond, in an appropriate manner to any of these hazards and risks or any other major crisis or if we are unable to efficiently restore or replace affected operational components and capacity.

Human capital and workforce · Talent acquisition and retention

We must also compete for the materials, equipment, services, employees and other personnel (including geologists, geophysicists, engineers and other specialists) necessary to conduct our business. If we are not successful in any facet of this competition, our financial condition and results of operations may be adversely affected.

Market position and competition · Competitive pressure and market share loss

The exploration and production of crude oil, bitumen, natural gas and NGLs is a highly competitive business. We compete with private, public and state-owned companies in all facets of the exploration and production business, including locating, acquiring and developing new sources of supply and producing crude oil, bitumen, natural gas and NGLs in an efficient, cost-effective manner.

Strategic execution · Joint venture and partnership risks

We conduct many of our operations through joint ventures in which another joint venture partner is the operator or we may not have majority control. In these cases, the economic, business, or legal interests or goals of the operator or the voting majority may be inconsistent with ours, and we may not be able to influence the decision making or outcomes to align with our interests or goals.

Innovation and product development · Product development and randd investment risks

If we do not successfully replace the resources we produce with good prospects for future organic development or through acquisitions, our business will decline. In addition, our ability to successfully develop our reserves depends on our achievement of a number of operational and strategic objectives, some aspects of which are beyond our control.

Strategic execution · Merger acquisition and divestiture risks

We regularly review our portfolio and pursue growth through acquisitions and seek to divest noncore assets or businesses. We may not be able to complete these transactions on favorable terms, on a timely basis, or at all. Even if we do complete such transactions, our cash flow from operations may be adversely impacted or otherwise the transactions may not result in the benefits anticipated due to various risks, including, but not limited to (i) the failure of the acquired assets or businesses to meet or exceed expected returns, including risk of impairment.

Cybersecurity and data protection · Third party data security and vendors

In addition, we have exposure to cybersecurity risks where our data and proprietary information are collected, hosted, and/or processed by third-party cloud and service providers. In addition, many of our vendors, including suppliers that are closely integrated into our business, have been victims of cybersecurity attacks that have accessed and exfiltrated information from their systems.

Market and investment · Market volatility and economic cycles

Among the most significant factors impacting our revenues, operating results and future rate of growth are the sales prices for crude oil, bitumen, LNG, natural gas and NGLs. These prices are tied to market prices that can fluctuate widely due to factors beyond our control. For example, over the course of 2025, WTI crude oil prices ranged from a high of $80 per barrel in January to a low of $55 per barrel in December.

Capital structure and performance · Credit rating and cost of capital

We are regularly evaluated by the major rating agencies based on a number of factors, including our financial strength and conditions affecting the oil and gas industry generally. We and other industry companies have had our ratings reduced in the past due to negative commodity price outlooks. Any downgrade in our credit rating or announcement that our credit rating is under review for possible downgrade could increase the cost associated with any additional indebtedness we incur.

Capital structure and performance · Dividend policy and capital allocation

Ordinary dividends are authorized and determined by our Board of Directors in its sole discretion and depend upon a number of factors, including: Cash available for distribution; Our results of operations and anticipated future results of operations; Our financial condition, especially in relation to anticipated future capital needs. Any downward revision in the amount of our ordinary dividend or the volume of shares we purchase under our share repurchase program could have an adverse effect on the market price of our common stock.

Reputation and brand · Esg environmental social governance performance

These major rating agencies are now considering ESG attributes when assessing credit profiles. While these assessments have limited impact today, they have the potential to pressure credit ratings over time. We could also receive lawsuits alleging a failure or lack of diligence to meet our publicly stated ESG goals or alleging misrepresentation related to our ESG activity.