TotalEnergies boosts share buybacks and promises higher dividends as oil hovers near $100

French oil and gas major TotalEnergies unveiled a new strategy in New York on Monday, announcing it would return more cash to shareholders. The company's board approved share buybacks worth $2.5 billion for the fourth quarter of this year and between $2 billion and $2.5 billion for the first quarter of 2027, up sharply from the $1.5 billion authorised for the third quarter.

On Sunday, the board also adopted a policy to raise dividends by more than 5% annually from 2026 through 2030, while confirming a target of returning at least 40% of cash flow to shareholders. The larger payouts come as TotalEnergies expects its gearing ratio to fall below 10% by year-end, down from 13.1% at the end of June. Following the announcement, TotalEnergies shares rose roughly 2% by Monday afternoon compared with Friday's close.

High oil prices lift earnings

The payouts are supported by elevated crude prices boosting profits across the oil sector. Brent crude averaged $103.8 a barrel in the second quarter, when TotalEnergies reported adjusted net income of $6 billion.

The company confirmed plans to grow total energy production — oil, gas and electricity combined — by 4% annually through 2030, with oil and gas output rising more than 3% a year on average between 2025 and 2030. Free cash flow in 2030 is expected to be around $10 billion higher than in 2025 at comparable energy prices, equivalent to an increase of more than $4 per share.

Projects in Namibia, Nigeria, Libya, Malaysia, Mozambique and Papua New Guinea, combined with existing reserves, should allow the company to maintain oil and gas output at around 3 million barrels of oil equivalent per day through 2035, with output set to grow a further 2-3% annually between 2030 and 2035. Electricity generation is expected to grow more than 20% a year, reaching 100-120 terawatt-hours by 2030, with the Integrated Power division turning cash-flow positive in 2027. Electricity is projected to account for a quarter of the company's energy mix by 2035. To fund this growth, TotalEnergies expects annual net investments of $14-17 billion between 2027 and 2032, while reaffirming its goal of halving direct and energy-related emissions from oil and gas operations by 2030 compared with 2015.