Occidental Petroleum, Devon Energy impress Wall St as oil price bounces

FILE PHOTO: The logo for Occidental Petroleum is displayed on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 30, 2019. REUTERS/Brendan McDermid

(Reuters) – U.S. oil and gas producers Occidental Petroleum Corp and Devon Energy Corp blew past Wall Street’s profit expectations on Tuesday, as easing travel curbs and rising vaccinations boosted fuel demand and crude prices.

Shares of Occidental rose nearly 2% to $26.95 in extended trade, while Devon climbed 1.9% to $26.70.

After a crushing 2020, oil prices have rebounded to multi-year highs and are now trading at over $70 a barrel, thanks to output curbs by the OPEC+ and a pick-up in economic activity.

Devon also announced a fixed-plus-variable dividend of 49 cents per share, 44% higher than last quarter’s payout, underscoring the energy industry’s focus on shareholder returns over spending to expand production.

Peers Diamondback Energy Inc increased its annual divided by 12.5% to $1.80 per share and Pioneer Natural Resources Co declared an inaugural variable dividend of $1.51 per share on Monday.

Occidental said its total production from continuing operations rose to 1.2 million barrels of oil equivalent per day (boepd), 7.7% higher sequentially.

The company’s average price for worldwide crude oil rose to $60.05 per barrel from $55.65 barrel in the prior quarter.

The oil and gas producer’s adjusted profit attributable to common stockholders stood at $311 million, or 32 cents per share, for the three months ended June 30. Analysts had estimated 3 cents per share, according to Refinitiv IBES.

Devon posted core earnings of 60 cents per share, beating an estimate of 52 cents per share.

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