After Lots of Belt Tightening, the Oil Patch Is Starting to Loosen Its Purse Strings
Oil companies made deep cuts earlier this year as oil prices crashed. All of them slashed capital spending on new oil projects, while most also cut back on shareholder distributions like dividends and buybacks.
However, with oil prices stabilizing in recent months, oil companies are feeling a bit more confident about their financial situations. What's interesting this time around is how they're using their increased flexibility. Instead of ramping up capital spending like they typically do following a deep price downturn, they're rewarding shareholders first. That's a welcome sign for a sector that has done a terrible job allocating capital in the past.
Image source: Getty Images.
Source Fool.com
