E Weekly Energy Roundup: Oil And Gas Companies, June 25 To 29

The last week has certainly been an interesting one for the oil markets. On Saturday, President Trump called the king of Saudi Arabia to ask them to increase oil output by two million barrels per day to escalate the proxy war on Iran. Meanwhile, Brent has continued to trade at much higher prices than it did during the same time last year (it closed at $79.44 on Friday). Energy companies as a whole have been benefiting from the turmoil, with many reporting record profits in the first quarter. We expect that they will do so again in the second quarter. 

ExxonMobil (XOM

ExxonMobil delivered a gain last week, steadily increasing during every day of the week. The company opened the week of June 25 at $80.78 per share and closed the week at $82.73 per share. This gives the stock an overall return of 2.41% over the week. 

Source: Fidelity Investments 

The stock’s two-week performance was also quite impressive, posting a fairly substantial gain over the period, although it had some volatility towards the end of the week of June 18. However, it went from $80.40 to $82.73 per share over the two-week period for a gain of $2.33, which works out to 2.90%. Shareholders should be relatively pleased with this gain. 

Source: Fidelity Investments 

There were two big news stories affecting ExxonMobil over the past week. The first was the news that U.S. Federal District Judge dismissed a lawsuit against ExxonMobil and several big oil peers effectively claiming that the companies should pay to protect cities against the ravages of climate change. The judge said that "the situation demands a political solution and not one that can be supplied by a judge in a public nuisance case." This lawsuit had the potential to result in massive payouts to plaintiffs should the companies have lost it, so the fact that the judge will no longer allow it to proceed is a positive sign for all of the companies involved. 

The second major piece of news affecting the company is that ExxonMobil along with its partner company Eni (E) have begun marketing the natural gas from the extremely gas-rich Area-4 block in Mozambique. The goal here is to see if there exists sufficient demand for the gas to proceed with the development of an LNG plant to export it. This could result in growth for the company as this gas is in prime position to be exported to the growing markets of Asia. 

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Disclosure: I am long XOM and CVX via ETF holdings but have no direct long positions in any stocks mentioned.

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