ExxonMobil (XOM)

History of the Company

ExxonMobil is an American company based in Texas that is involved in all aspects of oil and gas production. It was formed in 1999 by a merger of Exxon (Standard Oil of New Jersey) and Mobil (Standard Oil of New York). In 1911, the Standard Oil trust was broken down into 33 smaller companies, the largest of which were Standard Oil of New York and New Jersey. The ExxonMobil merger reunited these companies once again in the biggest corporate merger in U.S. history. ExxonMobil has 37 oil refineries in 21 countries, making it the largest global oil refiner. 

ExxonMobil’s environmental record is less-than-stellar. Major oil spills including the Exxon Valdez and spills in Brooklyn, Baton Rouge, and Yellowstone have brought criticism. Controversies over human rights issues, global climate change, and business practices have plagued the company over the years. Despite these events, ExxonMobil remains a leader in its industry and a strong company going forward. 

Trading ExxonMobil: What You Need to Know

  • ExxonMobil’s annual report and quarterly earnings reports can provide insights into the future performance of the company. As an energy company, ExxonMobil’s revenues are affected by oil production, as well as development of alternative technologies. 
  • While most of ExxonMobil’s profits come from the crude oil industry, limited oil reserves are forcing it to find alternative upstream sources of fuel and invest in new technologies, including deepwater drilling, high impact drilling, upstream oil sands production, and R3M (Remote Reservoir Resistivity Mapping) technology to improve results from exploration. In addition, ExxonMobil is investigating biofuels from algae.
  • With dwindling oil reserves, liquid natural gas is becoming more important to keep up with world demand for fuel. ExxonMobil’s Papua New Guinea liquefied natural gas project is set to meet this increased demand, especially to Asian markets. 
  • ExxonMobil has agreed to make public their risk management and opportunity plans for low-carbon scenarios. While this may seem like bad news, shareholders responded positively to the fact that the company is preparing for scenarios involving carbon caps and taxes, and when reserves eventually run out.

Anyone who wants to trade ExxonMobil stock should carefully research the company and perform an analysis before trading.

Trade XOM