What's Going On With Exxon Mobil (XOM) Stock?

Shares of Exxon Mobil Corp XOM are trading lower by 0.7% during Monday’s session as crude oil prices experienced a significant drop of over 6%, reaching levels not seen since early October.

This downturn can be largely attributed to investors reacting to the latest geopolitical developments in the Middle East, particularly Israel’s airstrikes targeting military facilities in Iran.

While the strikes were precise and avoided direct damage to Iran’s oil infrastructure, the market’s apprehension about the broader implications for regional stability has triggered a wave of selling in U.S. energy stocks.

What To Know: The latest figures show contracts for West Texas Intermediate (WTI) light crude, which are closely monitored by the United States Oil Fund, fell to around $67 per barrel. This drop marks one of the steepest single-day declines since July 2022, reflecting investor unease about the supply-demand balance in the oil market.

The immediate context surrounding the plummeting oil prices is rooted in the measured approach taken by the Israeli Defense Forces. Their airstrikes focused on Iranian missile production and air defense systems, sparing the oil infrastructure that, if targeted, could have risked approximately 1.7 million barrels per day of Iranian crude exports.

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Such a disruption would have had far-reaching consequences for oil prices and, consequently, for the stock valuations of major oil companies like Exxon Mobil. U.S. President Joe Biden’s warnings against actions that could disrupt Iranian oil output suggest the high stakes involved in maintaining a delicate balance in the region.

What Else: As analysts recalibrate their expectations for oil prices, some experts note that the restrained nature of Israel’s military actions might indicate a potential for de-escalation, which, in turn, could prevent a spike in oil prices that many had anticipated.

Goldman Sachs had previously projected that a significant disruption in Iranian oil supplies could push Brent crude prices up by $10 to $20 per barrel. However, with no immediate threats to Iran’s output, this outlook now appears overly optimistic.

Compounding the bearish sentiment, analysts from Capital Economics warn that if OPEC+ proceeds with unwinding its voluntary production cuts, the resulting increase in oil supply amid sluggish demand could keep prices under pressure for the foreseeable future.

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How To Buy XOM Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Exxon Mobil’s case, it is in the Energy sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

According to data from Benzinga Pro, XOM has a 52-week high of $126.34 and a 52-week low of $95.77.