Recently, the company unveiled plans to increase its spending on low-carbon projects and to meet its greenhouse gas emission reduction target by the end of this year, nearly four years ahead of its previous forecast. XOM intends to keep its annual capital spending between $20 billion – $25 billion through 2027. The company expects this spending boost to enable it to generate double-digit returns even if oil prices fall to as low as $35 a barrel.
However, the newly identified COVID-19 variant, omicron, is raising concerns. Oil prices fell substantially on December 1, after confirmation of an omicron case in the U.S. Both Brent and WTI front-month contracts in November posted their steepest monthly falls in percentage terms since March 2020, down 16% and 21%, respectively. XOM declined marginally intraday in the trading session on Dec1. If worries regarding the potential for the omicron variant to slow economic activity and thereby cut oil demand intensifies, XOM shares could retreat further.