(Reuters) - Oil and gas producer Anadarko Petroleum Corp slashed its quarterly dividend by 82 percent on Tuesday, preserving cash at a time when sliding oil prices have fueled losses.
It was the latest response yet by industry executives to the more-than 70 percent drop in crude prices, which has forced oil producers and their suppliers into a radical rethinking of how best to deploy capital.
The cut will save about $450 million annually, the company said.
Rival ConocoPhillips said last Thursday it would cut its own dividend for the first time in 25 years, saying it needed to plan for oil prices to stay low “for a longer period of time.”
Anadarko said it would issue a first-quarter payout of 5 cents, down from 27 cents last quarter.
Anadarko executives said last week they would ask the board of directors for some kind of reduction at its Monday meeting, noting that the company’s stock price drop had boosted the dividend yield.
Anadarko’s shares are down more than 55 percent in the past year, pushing the yield close to 3 percent. That is higher than most members of the S&P 500 index.
The dividend cut announcement did little to affect the share price. Shares of Anadarko were already down sharply and closed 7 percent lower at $37.24 a share. Crude oil prices fell sharply on the day, pulling down the entire energy sector.
Reporting by Ernest Scheyder in Houston and Manish Parashar in Bengaluru; Editing by Anil D'Silva and David Gregorio