(Reuters) -Chevron Corp on Wednesday said it would triple its share buyback program to $75 billion, the oil industry’s most ambitious shareholder payouts to date, as high oil and gas prices pad profits.
The oil industry has been facing calls from investors and the White House to put last year’s record quarterly earnings from sky high energy prices into more drilling, acquisitions, or to reduce prices for consumers.
Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM) are preparing to report record annual profits for 2022, nearly $100 billion combined. Those unprecedented earnings led analysts at Citi on Wednesday to ask whether Chevron and Exxon could use the proceeds to buy rivals such as Europeans BP (NYSE:BP), Shell (LON:RDSa) or TotalEnergies.
Chevron’s disclosure signaled it will allocate a big chunk of those profits to reward shareholders. The industry last year was one of the top sectors in the S&P 500 index after trailing the broader market for years.
The White House last year criticized oil producers for distributing cash to shareholders instead in investing in production to reduce energy prices for consumers. It also pressed oil producers to raise investments in renewable energy.
The U.S. oil producer also raised its quarterly dividend by 6% to $1.51 per share. The $75 billion buyback program has no expiration deadline. It replaces the board’s previous repurchase authorization of $25 billion from January 2019 until March 31 this year.