Exxon Mobil Corporation Stock Slides as Tariffs Weigh on Oil Prices
Exxon Mobil Corporation (NYSE:XOM) stock has fallen 4.6% week over week as of early afternoon trading on March 8. Shares have dropped 11.6% in 2018 thus far. Oil prices have shown weakness after the announcement from President Trump that his administration would impose tariffs on steel and aluminum imports in order to protect “national security interests”.
Oil industry experts and analysts are warning that the tariffs, the details of which are expected to be announced this week, could spark major volatility for oil. The prospect of a global trade war has the potential to hurt demand side for oil and push prices down as global trade and growth suffer. Oil prices were hovering around the $60 mark on Thursday, March 8 and threaten to drop below the mark for the first time since the global stock market rout in February.
Chief economic advisor and former Goldman Sachs Group Inc. executive Gary Cohn resigned from the Trump administration after refusing to support the tariffs. Lines were reportedly split in the White House between the protectionist wing which included Peter Navarro, Wilbur Ross, and Trump himself, and the so-called “globalist” wing which included moderates like Cohn, Mnuchin, and the recently-departed Rob Porter.
Exxon CEO Darren Woods said that the tariffs undo some of the “positive steps” of U.S. tax reform. However, Woods was also confident in dividend hikes of up to 8% in the short term. For now, Exxon stock offers a dividend of $0.77 per share representing a 4.1% dividend yield.