Trump Predicts Oil Prices Will Plummet Post-War
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: Yahoo Finance
- Oil Price Forecast: President Trump predicts that oil prices will drop sharply after the war, potentially returning to the $65 to $74 range; however, due to infrastructure damage from combat, prices may hover between $80 and $90 for the next two years, indicating market uncertainty and concerns over future supply.
- Energy Stock Investment: Despite oil price fluctuations, analysts remain bullish on energy stocks, particularly oil and gas, as they constitute only 3.5% of the S&P 500 Index, while investor allocations are nearly double, reflecting confidence in the energy sector and potential growth opportunities.
- Diamondback Energy: Diamondback Energy Inc. (FANG) reported a profit of approximately $1.7 billion last year, with expectations to surge to $5.6 billion this year, and 28 out of 31 analysts recommend the stock, highlighting its competitive advantage amid geopolitical uncertainty.
- TotalEnergies Growth: TotalEnergies SE (TTE) aims to increase its renewable energy generation capacity from 34 gigawatts to 100 gigawatts by 2030, demonstrating its strategic positioning in the renewable energy sector and enhancing its market competitiveness.
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Analyst Views on XOM
Wall Street analysts forecast XOM stock price to fall
19 Analyst Rating
12 Buy
7 Hold
0 Sell
Moderate Buy
Current: 140.740
Low
114.00
Averages
132.17
High
158.00
Current: 140.740
Low
114.00
Averages
132.17
High
158.00
About XOM
Exxon Mobil Corporation is an energy provider and chemical manufacturer. The Company’s principal business involves exploration for, and production of, crude oil and natural gas; the manufacture, trade, transport and sale of crude oil, natural gas, petroleum products, petrochemicals and a wide variety of specialty products; and pursuit of lower-emission and other new business opportunities, including carbon capture and storage, hydrogen, lower-emission fuels, Proxxima systems, carbon materials, and lithium. Its Upstream segment explores for and produces crude oil and natural gas. The Energy Products, Chemical Products, and Specialty Products segments manufacture and sell petroleum products and petrochemicals. Energy Products segment includes fuels, aromatics, and catalysts and licensing. Chemical Products segment consists of olefins, polyolefins, and intermediates. Specialty Products segment includes finished lubricants, basestocks and waxes, synthetics, and elastomers and resins.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Chip Sector Surge: Intel's stock jumped over 10% after President Trump announced a partnership with Apple to design and produce semiconductors domestically, leading the iShares Semiconductor ETF to rise more than 7%, indicating strong momentum in the tech sector.
- Energy Stocks Weaken: WTI crude oil prices fell to a 3.5-month low, causing significant declines in energy stocks, with SLB, ConocoPhillips, and Halliburton dropping over 3%, highlighting concerns over energy price volatility.
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See More
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- Oil Price Fluctuations: While Iranian tankers are moving through the Strait of Hormuz, oil prices are falling due to market misconceptions about supply recovery, indicating that investor optimism regarding a quick return to normalcy may lead to increased price volatility in the future.
- Importance of Inventories: The geopolitical conflict in the Middle East has led to the use of global oil inventories as a buffer against supply disruptions, but rebuilding these inventories will take time, resulting in demand being higher than normal in the short term, which could affect price stability.
- Industry Warnings: Energy giants ExxonMobil and Chevron have warned that the current U.S. strategic oil reserves are at their lowest level since 1983, suggesting that the timeline for market normalization may be underestimated, with potential for rising oil prices ahead.
- Sustainability Risks of Agreement: Although the reopening agreement may lead to a short-term increase in oil flow, the high-risk nature of the Strait of Hormuz raises questions about the long-term viability of the deal, prompting investors to remain cautious and avoid premature optimism regarding market signals.
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- Need for Inventory Rebuilding: With the U.S. strategic oil reserves at their lowest since 1983, Chevron and ExxonMobil emphasize that rebuilding inventories is crucial for restoring supply-demand balance, likely extending the energy market recovery beyond current investor expectations.
- Increased Transportation Risks: While Iranian oil tankers are now moving through the Strait of Hormuz, this high-risk transportation will require time to assess the stability of the new agreement, potentially leading to exaggerated short-term market reactions to oil price fluctuations.
- Caution from Industry Giants: As two of the world's largest energy companies, Chevron and ExxonMobil's insights into market turbulence are invaluable, and investors should heed their warnings to make informed decisions in an uncertain market environment.
See More
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- Energy ETF Performance: The Vanguard Energy ETF has delivered a 25% return year-to-date but has lost about 11% of its value since reaching an all-time high on March 27, indicating uncertainty in the future of energy stocks amid geopolitical tensions.
- Market Reaction: The S&P 500 index is up 10.4% year-to-date and has gained about 19% since hitting a 2026 low on March 30, but this may be bad news for energy stocks as the Vanguard Energy ETF and the S&P 500 have been moving in opposite directions since late March.
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See More
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See More
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