Oil Price Surge Supports ExxonMobil and Rivals

Crude oil prices have reached around $100 per barrel due to ongoing tensions in the Middle East. The U.S. Energy Information Administration (EIA) projects WTI at $84.65 per barrel for this year, higher than last year's $65.40.

This favorable pricing environment will continue to support ExxonMobil's exploration and production activities, which generate the majority of its earnings. The company has a significant presence in the Permian, the most prolific oil and gas play in the United States, as well as offshore Guyana.

ExxonMobil employs new drilling techniques and artificial intelligence to optimize production volumes at lower cost structures in the Permian. In Guyana, the company has made several oil and gas discoveries, solidifying its production outlook. Both resources have low breakeven costs.

Chevron Corporation (CVX) and ConocoPhillips (COP) will also benefit from high oil prices, as they generate a significant proportion of their revenues from crude oil. CVX has growth in production volumes due to its footprint in the Permian, while COP has low-cost drilling opportunities across the Permian, Eagle Ford, and Bakken.