U.S. oil and gas producers Diamondback Energy Inc., Continental Resources Inc. and Pioneer Natural Resources Co. reported strong second-quarter profit as rebounding demand for industrial activity and travel boosted fuel prices.
Oil prices are trading near multiyear highs helped by output curbs by the OPEC+, and easing restrictions due to COVID-19 vaccine roll-outs. U.S. crude has climbed 52% since the start of 2021 and 24% in the June quarter.
While Diamondback and Continental beat Wall Street profit estimates, Pioneer only met expectations, but declared an inaugural variable dividend of $1.51 per share to be paid during the third quarter.
Meanwhile, Diamondback increased its annual divided by 12.5% to $1.80 per share, and Continental said it was resuming its $1 billion share repurchase program, with $317 million of share repurchases previously executed.
On July 30, U.S. oil major Chevron Corp. also said it planned to resume share buybacks this quarter at an annual rate of $2 billion to $3 billion, after halting purchases last year following a COVID-19 pandemic led slump in oil prices.
These moves underscore the companies’ focus on shareholder returns over spending to expand production, even as crude prices climb to their highest levels since 2018.
Shares of Continental Resources were up 2.4% at $34.50 in extended trade, Diamond rose 0.2% and Pioneer Resources 0.7%.
Diamondback on Aug. 2 raised its full-year production to between 363,000 boe/d and 370,000 boe/d from 350,000 boe/d and 360,00 boe/d previously.
On an adjusted basis, Diamondback posted a profit of $2.40 per share compared with estimates of $2.19 per share, according to Refinitiv IBES.
Continental reported an adjusted profit of 91 cents per share compared with estimates of 55 cents per share, and Pionner’s adjusted profit came in at $2.55 per share.
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