9. Income Taxes

The following summarizes income tax expense (benefit) and effective tax rates:



	Three Months Ended September 30,						Nine Months Ended September 30,
millions except percentages	2017			2016			2017			2016
Current income tax expense (benefit)	$	430		$	64		$	670		$	212
Deferred income tax expense (benefit)	(855		)	(324		)	(1,036		)	(1,169		)
Total income tax expense (benefit)	$	(425	)	$	(260	)	$	(366	)	$	(957	)
Income (loss) before income taxes	(1,066		)	(1,007		)	(1,616		)	(3,313		)
Effective tax rate	40		%	26		%	23		%	29		%

The Company’s tax provision for interim periods is determined using an estimate of its annual current and deferred effective tax rates, adjusted for discrete items. Each quarter, the Company updates these rates and records a cumulative adjustment to current and deferred tax expense by applying the rates to the year-to-date pre-tax income excluding discrete items. The Company’s quarterly estimate of its annual current and deferred effective tax rates can vary significantly based on various forecasted items including future commodity prices, capital expenditures, expenses for which tax benefits are not recognized, and the geographic mix of pre-tax income and losses.

The Company reported a loss before income taxes for the three and nine months ended September 30, 2017 and 2016. The increase from the 35% U.S. federal statutory rate for the three months ended September 30, 2017, was primarily attributable to the following:


•	tax impact from foreign operations


•	income attributable to noncontrolling interests


•	federal manufacturing deduction

These increases from the 35% U.S. federal statutory rate were partially offset by the following:

•non-deductible Algerian exceptional profits tax for Algerian income tax purposes


•	net changes in uncertain tax positions

The decrease from the 35% U.S. federal statutory rate for the nine months ended September 30, 2017, was primarily attributable to the following:


•	non-deductible Algerian exceptional profits tax for Algerian income tax purposes


•	tax impact from foreign operations


•	net changes in uncertain tax positions

These decreases from the 35% U.S. federal statutory rate were partially offset by the following:

•income attributable to noncontrolling interests

•federal manufacturing deduction

The decrease from the 35% U.S. federal statutory rate for the three and nine months ended September 30, 2016, was primarily attributable to non-deductible Algerian exceptional profits tax for Algerian income tax purposes, the tax impact from foreign operations, non-deductible goodwill related to divestitures, and net changes in uncertain tax positions. These decreases were partially offset by increases to state taxes, net of federal benefit, and income attributable to noncontrolling interests. See Note 14—Noncontrolling Interests.