The year 2022 could be officially called the year of the energy companies as they were the true beneficiaries of rising energy prices. Prices recovered most of the pandemic losses during the previous two years, ahead of expectations. Sanctions against Russia’s oil allowed market players, such as ExxonMobil, to boost their revenues. XOM stocks rose by 80% by the end of 2022.
The company’s management has ambitious plans to increase crude production from the current 3.7 million barrels per day to 4.3 million over the coming years. It seems that the company has incentives and the necessary infrastructure to do so. ExxonMobil has also announced a massive buyback program of $50 billion that will run over the next three years. If its stock prices remain in the range of $80-100 per share, the amount of stocks in circulation may decrease by 13-15%. This would allow for $2.3 billion a year to be saved on dividend payments and this may prompt rising dividends more easily in the future. This would certainly attract more attention to XOM stocks.
The company has recently optimised its structure and operational spending.
