This year, oil companies are swimming in cash thanks to higher oil and gas prices. They could allocate this windfall in many ways, including drilling more wells, making acquisitions, retiring debt, paying dividends, and repurchasing shares. Most companies are putting a greater emphasis on one option over the other.

For example, many oil companies have prioritized paying dividends this year. They're boosting their regular dividend and making additional variable or special dividend payments. However, Marathon Oil (NYSE: MRO) has bucked this trend by emphasizing share repurchases. It's having a pretty dramatic impact on its outstanding shares.

Marathon Oil started buying back its stock last October. It did that after paying off another $900 million of debt in the third quarter, bringing its 2021 total to $1.4 billion and achieving its leverage target. That freed up its cash flow, allowing the company to spend $200 million on share repurchases that month. 

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Source Fool.com