Occidental Petroleum ( OXY) said its fourth-quarter earnings jumped 56% from a year ago owing to an increase in commodity prices.

Net income for the fourth quarter was $1.45 billion, or $1.74 a share, up from $930 million, or $1.09 a share, for the same period in 2006. Analysts were expecting $1.69 a share, according to Thomson Financial.

Revenue for the quarter was $5.52 billion, up 37% year over year.

Occidental's strong earnings report "reflects the continued success of our strategy to focus on profitable, long-lived oil and gas assets, disciplined investment philosophy and maintaining a strong balance sheet," CEO Ray Irani said in a prepared statement Tuesday.

The company said operating income from its oil and gas segment totaled $2.6 billion in the fourth quarter, up from $1.4 billion last year. The advance reflected $1.3 billion of increases from record crude oil and higher natural gas prices, along with the Dolphin project in the United Arab Emirates coming online.

Occidental achieved average realized prices of $80.30 per barrel of oil and $6.77 per thousand cubic feet of natural gas in the fourth quarter, compared with $52.55 per barrel of oil and $5.63 per MCF of natural gas the prior year.

Daily oil and gas production in the fourth quarter was 590,000 barrels of oil equivalent, vs. 561,000 BOE during the same period last year.

Occidental generated $94 million in operating income from its chemical segment in the quarter, down from $157 million a year ago.