Why BP Plc (ADR) And Royal Dutch Shell Have Decided To Maintain Dividends Amid Falling Crude Price
Bidness Etc looks at why BP and Shell have announced to maintain dividends despite tumbling crude price and lower capital spending budgets
By: MICHEAL KAUFMAN: Published: Feb 7, 2015
Crude oil price is a major source of concern for energy companies, since it has tumbled over 50% during the last six months. Companies amid the low-price scenario are looking to maintain adequate liquidity. Shareholders are also concerned over the amount of dividends they are likely to receive in the current scenario.
Shares of BP plc (ADR) (NYSE:BP) since the last six months have fallen over 18%, while shares of Royal Dutch Shell plc (ADR) (NYSE:RDS.A) have plummeted 15%. Investors and shareholders are clearly concerned regarding the ability of the energy companies to pay consistent dividends during these troubled times and have caused the energy stocks to crash since the crude oil price collapsed.