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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsBig Oil Spends on Investors, Not Output, Prolonging Crude Crunch
(Bloomberg) Big Oil is raking in historic amounts of cash, but the windfall isnt being invested in new production to help displace Russian oil and gas. Instead, executives are rewarding shareholders -- setting the world up for an even tighter energy market in the years ahead.
The Wests five biggest oil companies together earned $36.6 billion over and above their spending in the first quarter, or about $400 million in spare cash a day. It was the second-highest quarterly free cash flow on record and enough to relegate billions of dollars of Russia-related writedowns to mere footnotes in their recent earnings reports.
Oil booms typically spark a chase for higher production -- but not this time. All five supermajors have kept their capital expenditure budgets firmly in check and pledged that this discipline will hold in future years -- even as oil prices have closed above $100 a barrel on all but five days since Russia invaded Ukraine in February. With wells naturally declining in production every year and large projects taking half a decade or more to come online, any expansion lag happening now will push the possibility of new production even further into the future. ...........(more)
https://www.bloomberg.com/news/articles/2022-05-07/big-oil-spends-on-investors-not-output-prolonging-crude-crunch?srnd=premium
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Big Oil Spends on Investors, Not Output, Prolonging Crude Crunch (Original Post)
marmar
May 2022
OP
ck4829
(35,091 posts)1. So if you like pain at the pump, expect it to continue
Tickle
(2,540 posts)2. It would be unsustainable
Electric cars today, are too expensive for the average person.
mucifer
(23,566 posts)4. The shareholder think is frightful
The hospice I work for was bought by a large for profit based in Texas ☹️
We were non profit before. So now they have to make the shareholders happy. Its too soon to tell what it all is going to mean.
Strelnikov_
(7,772 posts)5. This began even before Covid
Few years back articles noting petroleum development was being reduced due to investors demanding higher return on investment.
Capitalism at its finest, the religion of the right. Yet, the MAGA base is screaming about prices set by the market.
Very Orwellian, preaching the wonders of capitalism and 'free markets', while screaming for a centrally planned economy (bitching about inflation).