XOM - Why Oil Stocks Like ExxonMobil Chevron and Vermilion Jumped Today
Shares of integrated energy majors ExxonMobil Corporation (NYSE: XOM) and Chevron Corporation (NYSE: CVX) were up by mid single digits at lunchtime on April 29. Smaller player Vermilion Energy (NYSE: VET), meanwhile, saw its stock rocket over 12% at the open, before settling down to a high single-digit gain by the middle of the day. Mr. Market was excited about oil today!
There's a glut of oil in the world today. There are a number of reasons for this, including the emergence of U.S. onshore drilling as a major global player over that last decade or so, OPEC and Russia getting into a temporary oil price war (which has now been concluded), and the global economic shutdowns related to the world's effort to slow the spread of COVID-19. Each one of these items could be written about extensively, but the big picture here is that supply is elevated at a time when demand has fallen dramatically and quickly.
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