The international oil companies (IOCs) are primed to generate record free cash flows this year if oil prices remain at current levels (~US$55/bbl Brent). Free cash generation would be more than double previous peaks were prices to average US$70/bbl. Repairing weakened balance sheets will be top of the capital allocation queue. Financial frameworks built around capital discipline and shareholder distributions are here to stay. Investment will recover only slowly even if confidence in higher prices grows. Strategic M&A will continue to favour paper over cash; share buybacks will be favoured in re-deploying any surplus cash post deleveraging. An elite group of financially-strong operators can afford to be more strategic at current prices, allocating capital to grow and decarbonise their legacy business or diversify into low-carbon energy. Others will follow as their balance sheets permit.