Devon Energy Says Inflation, Supply Chain Snags to Drive Up Costs 15%

Shares of Devon Energy were up about 5.4% at midday, outpacing gains in rivals, after the company boosted its fixed dividend by 45% and increased a share repurchase program by 60%.

Liz Hampton, Reuters

U.S. shale producer Devon Energy on Feb. 16 said it was anticipating a 15% rise in costs this year compared to 2021 due to inflation and supply chain constraints.

Oil prices in the U.S. have climbed to their highest levels in seven years, trading at nearly $95/bbl, as activity has come roaring back amid a recovery in demand. However, many oil companies are being hit by shortages in labor and critical supplies such as sand, which has driven up their costs.

“Inflationary pressure and supply chain disruptions are a reality,” Devon COO Clay Gaspar told investors during the company’s fourth-quarter conference call.

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