Shares of Exxon Mobil Corporation (NYSE:XOM) were down 3.69% in early afternoon trading on April 27. The company released its first quarter results on the same day. Exxon pumped 3.88 million barrels a day in the first quarter, which represented the first time the company had reported sub-4 million numbers in more than 15 years. Exxon’s profit of $1.09 per share also failed to meet analyst expectations.
The quarter comes as a disappointment as oil prices have undergone a significant rally in recent weeks. Softer inventories and heightening tensions in the Middle East have driven prices up, and many are betting that the rally will not let up. A top Goldman Sachs Group Inc. commodity analyst recently projected that oil could exceed $80 in the near term.
On Saturday we will be two weeks away from a crucial date that may drive oil prices into the late spring. U.S. President Donald Trump is set to decide whether or not to re-state sanctions on Iran, which could in turn lead to the scrapping of the Iran nuclear deal. The President has recently appointed two notorious anti-Iranian hawks to Secretary of State and National Security Advisor – Mike Pompeo and John Bolton. He has been extremely critical of the deal since he launched his election campaign in 2015.
Odds are that Trump will demand alterations that Iran is likely to reject. This will certainly intensify tensions in the region and put a dent in the significant supply that Iran has pumped into the oil market. In 2017 Iran exported almost 1 billion barrels of oil.
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