The energy crisis may have ignited public fury, but it has also paved the way for a historic payoff. In 2023, the five largest oil companies are expected to break all records, distributing over $100 billion to investors.
The five super-majors-British Petroleum, Shell, Chevron, ExxonMobil, and TotalEnergies-showered shareholders with dividend payments and share buybacks worth $104 billion in the 2022 calendar year, according to the Institute for Energy Economics and Financial Analysis (IEEFA).
According to a Guardian report, the bumper payouts followed a year of record profits for big oil and gas companies after Russia’s invasion of Ukraine upended global energy markets, triggering a rise in the international price of Brent crude and record gas prices across Europe.
Financial analysts at IEEFA said the companies were likely to pay even greater shareholder distributions this year despite weaker commodity market prices leading to lower profits. The payouts will also follow a year that is expected to have been hotter than any other on record, with the climate emergency leading to a series of extreme weather events.
“At the current pace of distributions via share buybacks and dividends, these five super-majors could set a record for distributions to shareholders in 2023, topping the $104 billion spent during the 2022 calendar year,” Trey Cowan, an analyst at the IEEFA, said.
The decision to reward shareholders with record payouts at a time of hardship for many could exacerbate public anger towards oil companies, which calls for increased regulation. While these payouts may benefit shareholders, they are unlikely to significantly impact oil prices, which are primarily driven by global market forces.