West Texas Intermediate (WTI) crude oil is currently trading above $85 per barrel, according to Oilprice.com. While this is lower than the recent peak of over $100 per barrel, the price remains favorable for ExxonMobil Holdings Corporation (XOM). The company's exploration and production activities, which drive most of its earnings, are well-supported by the current pricing environment.
ExxonMobil has a strong presence in the Permian Basin, the most productive oil and gas region in the United States, and offshore Guyana. In the Permian, the company is using advanced drilling techniques and artificial intelligence to enhance production efficiency and reduce costs. In Guyana, ExxonMobil has made several significant oil and gas discoveries, reinforcing its positive production outlook. Both assets have low breakeven costs, contributing to robust financial performance.
Other major oil companies, including Chevron Corporation (CVX) and ConocoPhillips (COP), are also benefiting from the high oil prices. ConocoPhillips generates a substantial portion of its revenue from crude oil, making the current price environment particularly advantageous. The company has low-cost drilling opportunities in the Permian, Eagle Ford, and Bakken regions, which could be developed over the next two decades. Chevron is experiencing production growth in the Permian, positioning it well to capitalize on the strong oil prices.
ExxonMobil's stock has increased by 40.4% over the past year, outpacing the industry's growth of 34.9%. From a valuation perspective, ExxonMobil trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 7.87X, which is higher than the industry average of 5.96X. However, the Zacks Consensus Estimate for ExxonMobil's 2026 earnings has seen downward revisions over the past week. Despite this, ExxonMobil currently holds a Zacks Rank #2 (Buy).