COM - United States: Global Petroleum Superpower - So What's Ailing Exxon And Chevron?
2024-02-08 17:58:20 ET
Summary
- Despite the U.S. being the No. 1 petroleum producer on the planet, Exxon and Chevron have not generated overly-compelling investment returns.
- That's despite the fact that both these companies have been generating tons of free cash flow and increasing returns of capital to shareholders.
- Recently, there have been a plethora of articles in the mainstream press wondering what the disconnect is between booming domestic oil and gas production and lagging O&G stocks.
- Today, I will take a broad and global review of the O&G sector, explain why it has been so under-performing, and give investors advice going forward.
As most of you know, technological disruption (i.e. fracking combined with horizontal drilling) resulted in the United States jumping over Saudi Arabia and Russia to become the No. 1 oil producer on the planet. U.S. oil production is currently at an all-time record high of more than 13.3 million bpd and is still inching higher (see graphic below). However, recently there has been a bevy of articles wondering why the two biggest U.S. oil companies - Exxon ( XOM ) and Chevron ( CVX ) - have been such lagging investments despite returning tons of cash to shareholders over the past couple of years. Today, I will answer this question and offer energy investors advice going forward.
United States: The Global Petroleum Superpower
The simple fact is this: By way of the fracking revolution, the United States is currently dominating global petroleum production:...
United States: Global Petroleum Superpower - So What's Ailing Exxon And Chevron?