If earnings reports from oil and gas giants are any indication, predictions of “peak oil” continue to look flimsy — especially as America’s largest energy names, ExxonXOM

and ChevronCVX

, demonstrate the staying power of the fossil fuel industry after a wild few years.

Oil, on and up: The two oil and gas goliaths reported record production in their final quarterly results of 2024, showing that the negative oil prices and supply shocks of the COVID-19 pandemic are now firmly in the rearview. However, despite record production, lower oil and natural gas prices ate into profits, with both companies facing year-over-year declines in net income. Thankfully, shareholders had plenty to celebrate.

• Both firms showered shareholders with cash in 2024, with Exxon spending $36B on shareholder distributions and Chevron making a record $27B in share repurchases.
• On the news,XOM
  andCVX
  fell 2.5% and 4.5%, respectively, while the Energy Select Sector SPDR FundXLE
  followed them down to the tune of 2.8%.

Oil Golden Age

Oil companies might be in a good position for 2025, thanks to a generous new policy from Republicans and President Donald Trump. However, with the price of WTI Crude down 2% YoY to $73, many firms are hesitant to embrace Trump’s “drill, baby, drill” ethos.

• Despite industry-wide optimism, an NYT story says that oil & gas CEOs are unlikely to boost production unless energy commodity prices rise.
• Making matters worse, natural gas has been plummeting as a result of warmer temperatures — Nymex front-month contracts plummeted 12%+ week-over-week to $3.044.

Forward-looking: The new administration’s abandonment of clean energy and its embrace of fossil fuels have helped the energy industry maintain the highest share of “buy” ratings relative to other sectors — tied with the tech-heavy communication services sector, per FactSet. If oil or gas prices don’t tick up, then energy names might have to rely on Trump & Republicans to help distract from their expected declines in profit in 2025.