Draining the Tank: Big Oil Runs on Fumes

Impact · against what's priced in

The removal of the geopolitical risk premium creates a systemic devaluation across the energy sector, specifically undermining the high-premium acquisitions made by XOM and CVX. Shell faces additional downside pressure due to the removal of its share buyback floor, while XOM is further weakened by significant institutional exits and previous trading losses.

XOM−0.80

No priced-in read yet

In context

The collapse of crude prices to the $76-$78 range breaks the financial modeling for the $64.5 billion Pioneer acquisition, while a $3.9 billion derivative loss and massive selling by Capital International Investors exacerbate the downside.

Read from the article alone

• XOM▲157%
• CVX▲69%
• energy▲2%
• oil
• geopolitics
• m and a
• SHEL