In 1911, John D. Rockefeller’s Standard Oil monopoly was broken up by U.S. regulators, since then multiple oil companies have existed. Today this may change once more, and for the first time in over 100 years, we may be seeing a gargantuan oil company. Recently Chevron and Exxon have discussed a merger. The size of this merger would be so large it would become the second-largest oil company on the face of the earth, coming only second to Saudi Aramco. Together, Chevron and Exxon would hold a combined market value of over $350 billion and produce about 7 million barrels of oil and gas daily.
Despite the size of the deal, many have pointed out that it is still in preliminary stages and that the Biden administration is focusing on the transition to more green energy, and some speculate the administration could place antitrust restrictions on such a merger. If the merger does happen, however, both companies will see to benefit as their mutual struggle during the COVID pandemic.
Experts have pointed out that mergers can cut costs and improve operational efficiencies which would help weather post-pandemic downturns. Do you think the merger will occur, and if not, why?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.