Exxon and Chevron Ride Plastics Boom to Cash-Flow Bonanzas

  • Date: 30-Jul-2021
  • Source: Yahoo News
  • Sector:Economy
  • Country:Gulf
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Exxon and Chevron Ride Plastics Boom to Cash-Flow Bonanzas

(Bloomberg) -- Chevron Corp. is reviving share buybacks that were suspended more than a year ago, signaling confidence that strong cash flows from high commodity prices will be sustained well into the future.

The repurchases will begin during the current quarter and range between $2 billion and $3 billion a year, around half the amount it devoted to the program before it was suspended in early 2020. Chevron’s move followed similar steps by Royal Dutch Shell Plc and TotalEnergies SE, which reinstated buybacks on Thursday. Stock repurchases are being revived or raised across the board as sectors as diverse as steelmakers, retailers and manufacturers ride the crest of economic expansion.

Big Oil executives are seeking to reward shareholders as commodity prices rise, a turnabout from previous booms when excess cash was poured into costly growth projects. Faced with enormous climate challenges, the industry is attempting to entice investors by offering robust returns at a time when the dividend yield of the S&P 500 Index is at the lowest in almost two decades.