Following new domestic and global trends, International Energy Agency said recently that energy companies allocated only 48 percent of their operating cash flow for capital spending in 2022 – down sharply from 93 percent in 2016. And they increased dividends and share repurchases to 39 percent of cash flow compared to 7 percent in 2016.
“This has pretty much become the trend even on a global scale,” OilPrice.com said June 13. “The 2020 oil price crash that sent oil prices into negative territory has seen energy companies adopt a more restrained, strategic and environmental-focused approach in their spending. U.S. shale drillers have abandoned their trigger-happy drilling days and are mostly sticking to their pledge to cut costs, return money to shareholders in dividends and share buybacks, and pay down debt… Energy companies have cut capex by nearly half but increased cash returns to shareholders by nearly five-fold.”
