ExxonMobil gains 24% year to date, forecast to top S&P 500

ExxonMobil Corp. has surged 24% in 2026, more than double the S&P 500's 10% gain, as Middle East turmoil keeps oil prices elevated.

"The supply disruption caused by the conflict has left the world short of oil and natural gas, and a return to normal could take months," analysts at The Motley Fool wrote in a May 28 note. "Limited supply has pushed energy prices higher, leading investors to buy Exxon."

Brent crude traded at $92.25 a barrel after falling 4.6% on a reported US-Iran ceasefire, while West Texas Intermediate settled at $88.68. The 10-year US Treasury yield slipped to 4.48% as lower oil prices eased inflation pressure. Even with the pullback, crude remains well above levels that sustain Exxon's production. The energy sector has been the S&P 500's top performer this year, with Halliburton Co. up nearly 40% and Chevron Corp. advancing alongside Exxon.

The question is whether Exxon can hold its lead. Energy executives have warned that supply shortages are not yet fully reflected in prices, suggesting further upside if the conflict persists. With the Strait of Hormuz reopening uncertain, Exxon's outperformance may extend through year-end.

Exxon's rally differs from speculative surges seen in names like NuScale Power Corp., whose shares soared and plunged on enthusiasm alone. The oil giant's gains are tied to a tangible supply shock. The US military launched strikes in southern Iran, and while a ceasefire appeared to hold, the path to normal oil flows remains unclear.

The S&P 500's 10% advance is itself historically strong for a five-month stretch. But Exxon has outpaced it by a wide margin because energy profits rise directly with crude prices, creating a mechanical link between the commodity and the stock.

When Oil Prices Retreat

The risk is clear: when the Middle East conflict ends, oil prices could decline, pulling Exxon's shares down. Brent crude's 4.6% drop on May 28 — the day the ceasefire report emerged — triggered a 1.3% decline in Exxon stock. A sustained resolution could erase much of the year's energy sector gains.

But timing matters. Energy executives say restoring supply chains after months of disruption will take time. Even if a formal ceasefire holds, the return to pre-conflict production levels may stretch into 2027, providing a cushion for Exxon's valuation.

This article is for informational purposes only and does not constitute investment advice.