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Buy Exxon Mobil Stock Amid Oil Price Rally

Buy Exxon Mobil Stock Amid Oil Price Rally
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Exxon Mobil (NYSE: XOM) stock price is offering an attractive buying opportunity amid the potential increase in oil prices. Iranian-aligned Houthi rebels drone strikes have erased almost half of the Saudi oil production.

Oil prices soared sharply in Monday trading due to the prospects for the decline of 5 million barrels per day in Saudi production.

Crude oil price surged 19% following news of drone attacks, the largest intraday gain since 1991. WTI price also experienced similar gains. Yemen’s Houthi rebels claimed credit for the drone attack. They say they have sent 10 drones to strike at Aramco (ARMCO) facilities.

Analysts say the decline in production from the largest OPEC producer would give a significant boost to oil prices.

Exxon stock price is also likely to get a momentum amid the potential improvement in oil prices. Exxon stock price is currently trading well below from its 52-weeks high of $87 a share.

XOM Exxon Mobil Corporation daily Stock Chart

The potential rally in oil prices is likely to support its share price. In addition, the benefit of improving oil prices is not limited to its share price performance. Exxon has significant production potential.

Its production in the second quarter increased 7% year over year to 3.91M boe/day. The growth in production is driven by the Permian Basin. It’s Permian Basin production jumped 90% from the year-ago period, up 20 % Q/Q.

Darren W. Woods, ExxonMobil chairman, and the chief executive officer said, “The company appears optimistic about future growth prospects. Our upstream liquids production increased by 8 percent from last year, driven by growth in the Permian Basin, and we are preparing to startup the Liza Phase 1 development in Guyana, where the estimated recoverable resource increased to more than 6 billion oil-equivalent barrels.

Besides from Liza Phase 1, the company is working on several other projects such as Stabroek Block to expand its production potential. Overall, the improvement in oil prices would enhance Exxon Mobil stock price and financial numbers.

All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
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siraj sarwar

Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.

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