Chevron Stock Rises and ExxonMobil Falls as Both Confront Lower Oil Prices

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The recent financial results of Chevron and ExxonMobil underscore the dynamic nature of the global energy market. Despite reporting lower earnings due to declining oil prices, Chevron's share price rose, reflecting investor confidence in their strategic resilience. This juxtaposition highlights how market fluctuations in oil prices can have varied impacts even among industry giants.

For those of us engaged in the water treatment business and extraction of critical minerals, these developments are more than mere headlines, they signal underlying trends that could influence our industry over the next 15 years. Fluctuations in the oil market lead to shifts in iodine production, energy policies, and technological innovation, all of which can impact the pricing with demand remaining untouched.

By understanding these shifts, we can better position ourselves to navigate challenges and seize opportunities that arise from the evolving dynamics of global energy markets.

Chevron Stock Rises and ExxonMobil Falls as Both Confront Lower Oil Prices

Last Friday, the world’s two biggest international oil companies, ExxonMobil and Chevron, both reported lower Q3 earnings than a year ago, largely due to lower oil prices. Chevron’s share price rose nearly 3 percent, while ExxonMobil’s share price dropped 1.5 percent.

Oil and Gas Price Trend:

The price of crude has been down 15% over the past six months, reaching a three-year low last Friday. Brent was $72.9/barrel, our WTI was at $69.2/barrel. These lower prices are due to weak demand and increased production by the United States and several non-OPEC countries, including Guyana, Canada, and Brazil.

U.S. crude production reached a record of 13.4 million barrels per day in August 2024, according to the U.S. Energy Information Administration. Natural gas prices reached historical lows driven by a supply glut.

On November 4, however, OPEC announced that it would further delay increasing its production, leading to a strong rebound of more than 2 percent for Brent and WTI.

Chevron Q3 Results:

Chevron made $4.5 billion in earnings in Q3—compared to $6.5 billion in Q3 2023—due to lower margins.

Chevron’s share price rose 2.9 percent, as its earnings beat analyst expectations, according to the Wall Street Journal.

Production was 3.4 million barrels of oil equivalent per day, up 7 percent over Q3 2023.

Chevron executed $4.7 billion in stock buybacks in Q3, a single-quarter record.

The company also announced $8 billion in divestments of non-core assets (Dr. Sakharov: Guess which ones?) in Canada, Alaska, and the Congo. These deals are expected to close in Q4.

“We are prepared to compete in any price environment, and a downcycle would not be a surprise,” said Chevron CEO Mike Wirth during an interview.

ExxonMobil Q3 Results:

ExxonMobil reported a net income of $8.6 billion in Q3—compared to $9.1 billion in Q3 2023—due to lower oil prices and reduced margins. This drop occurred despite higher upstream production.

The company achieved oil production of 3.2 million barrels per day, the highest in over 40 years, and a total production of 4.6 million barrels of oil equivalent per day, including 1.4 million barrels of oil equivalent per day from the Permian Basin.

Despite setting records, Exxon’s upstream results were still considered “underperforming” versus analyst expectations, as noted by TD Cowen.

Earnings from its Energy Products division were $1.3 billion, down 46 percent compared to the $2.4 billion reported in Q3 2023.

“The largest single factor that we would have seen year over year is just industry price margins… especially both in terms of gas prices and refining margins, coming off of historical highs,” said Kathryn Mikells, ExxonMobil’s CFO.