Energy giant Chevron (CVX) announced that it expects its 2026 capital expenditure to be in the range of $18 billion to $19 billion. The company’s capex outlook for next year is at the low end of its long-term guidance range of $18 billion to $21 billion. Last month, Chevron said that it plans to grow free cash flow by more than 10% annually through 2030 and increase oil and gas production, while bringing down its costs and capital expenditure.
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The company’s Q3 earnings per share (EPS) declined by more than 26% year-over-year in Q3 2025 due to lower oil prices and costs related to the Hess acquisition.
Chevron’s Capex Plans Reveal Focus on U.S. Shale, Guyana
It is worth noting that more than half of Chevron’s 2026 capex budget is directed towards the domestic market. Notably, Chevron is targeting capital spending of $10.5 billion in the U.S. Also, $17 billion of the budget is directed towards the company’s upstream business. In fact, CVX is focusing on activities in the U.S. shale and Guyana. Chevron is targeting $6 billion of capex for American shale and tight assets, including Permian, DJ, and Bakken, with an anticipated production of more than two million barrels of oil equivalent per day.
Spending on offshore production is set at about $7 billion, mainly to support projects in Guyana, activities in the Eastern Mediterranean, and growth in the Gulf of America. It is worth noting that Chevron completed its $55 billion Hess acquisition in July. The deal’s key asset is a 30% stake in the Stabroek Block in Guyana. The acquisition also includes new assets in the Bakken shale formation in the U.S.
Meanwhile, Chevron’s 2026 downstream capex is expected to be about $1.0 billion, with about 75% allocated to the U.S. The company highlighted that within total upstream and downstream budgets, about $1.0 billion is allocated to reducing the carbon intensity of operations and growing new energy businesses.
Is CVX Stock a Buy, Hold, or Sell?
Currently, Wall Street has a Strong Buy consensus rating on Chevron stock based on 14 Buys and three Holds. The average CVX stock price target of $177 indicates about 17% upside potential. CVX stock has risen by 5% year-to-date. It offers a dividend yield of 4.5%.
