Dividend Cuts to Oil Companies?

[Jago]

I bought some ESV at a price that put me at just above 10% yield. Yes, I am aware that offshore drillers are probably some of the riskiest oil investments out there, but when the entire sector as a whole trades below 0,6 PB, I am inclined to take my chances with a driller that has 1) the least leverage compared to peers 2) has the best dividend coverage among peers 3) has the second newest fleet (after Seadrill).

With those things considered, if we see a 12+ month slump in oil prices, I expect ESV to eventually cut their dividend in half, but I can live with the resulting 5% YOC.