Exxon Mobil, Chevron and ConocoPhillips fall after Saudi Arabia cuts oil prices

Shares of leading oil companies such as Exxon Mobil, Chevron and ConocoPhillips all fell after Saudi Arabia announced it would cut oil export prices by $2 per barrel. The decision by one of the world’s largest oil exporters sent ripples through the market, leading to a sharp drop in crude oil standards. West Texas Intermediate (WTI) crude oil fell more than 4% to below $71/barrel, while Brent crude oil fell about 3.5% to around $76/barrel.

The impact was also reflected in the share prices of Exxon Mobil, Chevron and ConocoPhillips, with Exxon Mobil falling 2.68%, Chevron falling 1.65% and ConocoPhillips falling 2.84%. The downturn comes despite financial services firms Truist and Piper Sandler recently raising their price targets on oil majors in anticipation of stable oil prices.

Despite the immediate market reaction, analysts remain optimistic about the oil industry’s prospects. Truist predicts that WTI crude oil prices will average $78 per barrel by 2024, noting that these companies have previously generated significant profits. Exxon Mobil, Chevron and ConocoPhillips earned a combined $55.5 billion, and forecasts show profits could reach about $74 billion this year if oil prices stabilize.

Analysts also highlighted that energy stocks may be undervalued given their current price-to-earnings ratios. They advise investors to hold on during market volatility, signaling their confidence in the energy sector’s long-term resilience and profitability despite short-term price swings.

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