Exxon Mobil (NYSE:XOM)’s senior executive Liam Mallon addressed the Energy Intelligence Forum conference in London on Tuesday, indicating that U.S. oil and gas producers are not expected to substantially increase production under the incoming administration of president-elect Donald Trump.
According to Reuters, Mallon noted that a significant shift in production is improbable as companies prioritize the economics of their operations.
Mallon, who leads Exxon’s upstream division, emphasized the industry’s commitment to maintaining capital discipline, which he believes will naturally cap growth rates. He stated, “We’re not going to see anybody in ‘drill, baby, drill’ mode,” underscoring the focus on cost-effectiveness and quality.
The United States, having experienced a boom in shale oil production, emerged as the world’s leading oil producer earlier with over 13 million barrels per day. It also holds the title for the top natural gas producer globally.
While Trump, set to take office on January 20, has signaled a wide-ranging energy package to be unveiled early in his presidency, Mallon suggested that easing land permitting processes might only offer a temporary lift to production levels.
He projected that any growth in Exxon’s oil production in the Permian shale basin, which is expected to exceed 2 million barrels per day, would continue for a few years but not at a constant rate, with potential growth extending up to 2030.
Exxon has recently fortified its status as the largest shale producer through the acquisition of Pioneer Natural Resources (NYSE:PXD), a transaction valued at $60 billion. This strategic move is part of the company’s broader efforts to scale operations in a financially disciplined manner.
Additionally, BP (NYSE:BP)’s CEO Murray Auchincloss expressed optimism about the Trump presidency at the same conference on Monday, particularly regarding the anticipated acceleration of permitting times for energy projects. This sentiment reflects a broader industry anticipation of a more favorable regulatory environment under the new administration.
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