Chevron Falls 1.9% as Trump Demands Oil Price Cuts After Windfall Profits on August 4

President Trump attacked Chevron and ExxonMobil on August 3 for profiting excessively from the Iran conflict. Chevron reported record Q2 earnings of $12.2 billion, a fivefold jump from $2.5 billion last year, while Exxon’s profits doubled to $14.5 billion. Trump demanded both companies cut retail fuel prices immediately. Chevron shares fell 1.9% on the comments as crude oil prices dropped 5% on hopes of U.S.-Iran negotiations.

Record profits fuel Trump’s anger at oil majors

Chevron and ExxonMobil reported combined Q2 profits of $26.5 billion, driven by crude oil prices that have gained roughly 20% since the U.S. and Israel attacked Iran on February 28. Chevron’s $12.2 billion profit marked its highest ever quarterly result, while Exxon’s $14.5 billion was its best since Russia’s 2022 invasion of Ukraine. Trump told reporters at the White House: “They’re making too much money based on a shortage. I don’t like it.” He demanded both firms “give some of that back to the public” and cut consumer fuel prices.

Gasoline prices remain elevated despite oil pullback

U.S. crude oil futures averaged $92 per barrel from April through June, roughly 27% higher than Q1. Gasoline prices nationwide averaged $4.10 per gallon on August 3, nearly 40% above the $2.98 per gallon drivers paid on February 27 before the war started. Crude prices fell about 5% on August 3 as Trump signaled an imminent deal with Iran and new negotiations. Brent crude dropped to $82.91 per barrel, down 18% from last month’s peak of $101.

Trump singles out Chevron CEO Mike Wirth

Trump criticized Chevron CEO Mike Wirth on his Truth Social platform for not crediting the administration’s support for the oil industry. “Without the genius, foresight, strength, and stability of the TRUMP Administration, the Oil Industry, and our Country itself, would be DEAD,” Trump wrote. He noted that Chevron had been “thrown out of Venezuela” but is now “back, far bigger and stronger than ever before.” Wirth had praised employees in a Fox News interview, promising most workers a bonus equal to half their monthly base pay.

Stock reaction and analyst outlook

Chevron shares fell 1.9% after Trump’s comments, while Exxon traded slightly lower. Meyka grades both stocks B+, with four analysts rating Chevron a Buy and three backing Exxon. Chevron trades at a PE of 29.49 with a 12-month Meyka forecast of $204.13, suggesting 5.7% upside from current levels. Exxon’s PE stands at 24.26 with a 12-month forecast of $166.03, implying 7.1% upside. Both firms are using windfall profits to reduce debt rather than boost shareholder returns.

Final Thoughts

Trump’s political pressure on oil majors reflects voter anger over fuel costs ahead of November’s midterm elections. While Chevron and Exxon face short-term reputational risk, both carry B+ grades and strong analyst support, suggesting the market views the criticism as temporary political theater rather than a fundamental threat to earnings.

FAQs

Disclaimer:

The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.