5 Big Oil Companies Likely Gave Shareholders Record Payouts for 2023: IEEFA Estimate

Five of the top Big Oil companies in the world were expected to pay shareholders over $100 billion for 2023.

The estimated 2023 payouts from BP, Shell, Chevron, ExxonMobil and TotalEnergies were on track to surpass the dividend payments and share buybacks from 2022, which reached $104 billion, according to the Institute for Energy Economics and Financial Analysis (IEEFA).

“At the current pace of distributions via share buybacks and dividends, these five super-majors could set a record for distributions to shareholders in 2023, topping the $104 billion spent during the 2022 calendar year,” Trey Cowan, an analyst at IEEFA, told The Guardian.

According to International Energy Agency (IEA), the entire oil and gas industry made $4 trillion in 2022, a record high. But the industry experienced a decline in profits for 2023, according to IEEFA. 

In 2022, ExxonMobil saw record-breaking profits of $56 billion. As of Q3 in 2023, the company’s profits had declined compared to its 2022 profits, The Associated Press reported. 

BP also made headlines in early 2023 following a year of record profits, as the company announced plans to expand oil and gas production through 2030 rather than work toward climate targets to reduce production. The company has increased dividend payouts by about 20% in 2023, after initially expecting to offer a 10% increase last year, despite a decline in profits compared to the previous year.

Shell, a company that also experienced a decline in profits, announced in November that it would offer payouts of at least $23 billion, a total more than six times the amount of money the company reserved for renewable energy in 2023, The Guardian reported.

Aside from criticism over spending far more in shareholder payouts than investing in clean energy, campaign groups have argued that these Big Oil companies are making massive profits from the Russia-Ukraine war and the high energy costs that have negatively impacted customers.

“The global energy crisis has been a giant cash grab for fossil fuel firms. And instead of investing their record profits in clean energy, these companies are doubling down on oil, gas and shareholder payouts,” said Alice Harrison, a campaigner at Global Witness, as reported by The Guardian.

Despite increasing payouts for shareholders in 2023, experts predict the industry will no longer hold the top spot for highest payouts in 2024.

Cowan told The Guardian that the oil industry “is beginning to empty its war chest used to pay shareholders faster than they can replenish it. Future distributions to shareholders of these companies appear likely to fall and not continue to ascend.”

In November 2023, Reuters reported that major U.S. investors in Big Oil Companies, including JPMorgan Chase & Co. and Vanguard, voted against Follow This climate resolutions, which are focused on reducing emissions by 2030 to limit warming to 2 degrees Celsius. Some of the top investors based in Europe voted in favor of the resolutions, the report found.