The repurchase of outstanding shares by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may be looking for a controlling stake. Buyback is a method for a company to invest in itself since they can’t own themselves. In 1994 the top five oil companies were spending 3% of their free cash on share buyback and 15% on exploration. By 2007 the ratio had changed to 34% on buyback of their own shares and only 6% on exploration, thus propping up their share price. This trend reflected big oil companies’ difficulties in finding uses for their large cash flows