We recently published a list of 11 Best Crude Oil Stocks To Buy Right Now. In this article, we are going to take a look at where Exxon Mobil Corporation (NYSE:XOM) stands against other best crude oil stocks to buy right now.
Crude oil markets have seen extreme volatility over the past year, fueled by a variety of economic, geopolitical, and supply and demand factors. Prices fell at the end of 2023, when international demand faltered and supply remained strong from key regions, before rebounding in early 2024 as leading oil-producing countries implemented supply cuts to stabilize the market. Meanwhile, demand signals have been mixed — industrial activity in major economies has improved, but high interest rates and inflationary pressures have limited overall energy consumption. After the presidential elections in the US, the Trump 2.0 agenda appears to be driving cracks in the economic outlook, due to a plethora of initiatives such as tariffs, a fight with immigration, and significant cuts in government spending. Despite Republicans notoriously being pro-business and pro-carbon, as confirmed by an announced policy of encouraging energy exploration and production on Federal land and Outer Continental Shelf, the reaction of the stock market has been mixed, as many crude oil stocks have underperformed the broad market in the last couple of months.
The reluctance of the broad market to price in an acceleration in the crude oil space is likely due to expectations of lower oil prices, primarily driven by an uncertain economic and industrial outlook. A slowing economy generally consumes less oil, which coupled with an increasing supply should put downward pressure on prices. Optimism for the year ahead vanished and the outlook has become one of the gloomiest since the pandemic. Companies started to signal widespread concerns about the impact of government policies, ranging from spending cuts to tariffs and geopolitical developments. For instance, the US economic surprise index hit the lowest last week since September, while the business capex forecasts were abruptly cut at the beginning of the year. Small businesses reflect similar signals, by cutting their capex expectations (as per surveys), while consumers report deteriorating financial expectations going forward. All these developments don’t play out in favor of a strong economy in the following quarters.
Financial markets have reflected this turbulence, as energy stocks moved in tandem with the swings in oil prices, which retracted more than 10% since the inauguration day. While refiners and midstream companies have generally performed well due to resilient transportation and processing demand, exploration and production firms have faced challenges in securing new investments. Looking forward, macroeconomic and geopolitical factors will continue to shape the crude oil market. Geopolitical factors, particularly in key oil-producing regions, remain an ongoing concern – with the end of the Ukraine conflict becoming a reality, Russian oil will likely flow more freely abroad, putting even more downward pressure on global prices. Despite the aforementioned headwinds, there are also some positive takeaways for investors – while renewable energy investments continue to grow, the transition remains gradual, ensuring that crude oil will remain a critical component of the global energy mix in the future, especially under the carbon-friendly Trump 2.0 regime. Furthermore, with oil prices declining and many crude oil stocks being down from their mid-2024 highs, the current developments may turn out to be a great long-term buying opportunity.
Our Methodology
We used the Insider Monkey proprietary hedge fund holding database and identified the 11 most popular crude oil companies, ranked by the number of hedge funds that own the stock.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Aerial view of a major oil rig in the middle of the sea, pumping crude oil.
Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 104
Exxon Mobil Corporation (NYSE:XOM) is one of the world’s largest integrated energy companies, engaged in the exploration, production, refining, and marketing of crude oil, natural gas, and petroleum products. With operations spanning six continents, XOM has a significant presence in major oil-producing regions, including the Permian Basin, offshore Guyana, and the Middle East. Its upstream segment focuses on crude oil and natural gas extraction, while its downstream business operates a vast refining and petrochemical network, supplying fuels, lubricants, and chemicals to global markets. The company is also a major player in LNG and is investing in carbon capture, hydrogen, and biofuels as part of its long-term energy strategy. Despite expanding into lower-carbon initiatives, crude oil remains central to XOM’s operations. The US-based company ranked 7th on our recent list of 10 Companies That Are Buying Back Their Stock in 2025.
Exxon Mobil Corporation (NYSE:XOM) delivered strong 2024 results with earnings of $34 billion, marking their third-highest result in a decade despite softer market conditions. The company generated cash flow from operations of $55 billion and achieved a ROCE of 13%. In the Upstream segment, the company achieved the highest-ever production from advantaged assets and the highest liquids production from their overall portfolio in more than 40 years. The Permian Basin operations delivered record production from both Heritage ExxonMobil assets and Pioneer assets, with production expected by management to grow from 1.5 million oil-equivalent barrels per day at the end of 2024 to 2.3 million barrels per day by 2030. In Guyana, the company achieved record production, reaching 650,000 barrels per day in just 10 years.
Looking forward, Exxon Mobil Corporation (NYSE:XOM) expects to bring online several major projects in 2025 that will deliver more than $3 billion in earnings potential in 2026 at both constant and current prices and margins. The company plans to build an even more advantaged asset portfolio with 60% of Upstream production from advantaged assets by 2030. Management expects to generate $20 billion more in earnings and $30 billion more in cash flow by 2030 while taking an additional $6 billion in cost out of the business. XOM is also developing new technology-driven businesses, such as Proxxima products and carbon materials, which creates opportunities to expand beyond traditional fuels and chemicals into higher growth, higher-margin markets that are decoupled from commodity price fluctuations. All in all, the management outlook is highly optimistic and largely immune to short-term oil price developments.
Overall, XOM ranks 1st on our list of best crude oil stocks to buy right now. While we acknowledge the potential of XOM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than XOM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.