Trump's "diplomatic offensive" reshapes the global oil market: Exxon Mobil Corporation (XOM.US) and Chevron Corporation (CVX.US) are taking advantage and making a big push into OPEC countries.

Notice that Exxon Mobil Corporation (XOM.US) and Chevron Corporation (CVX.US) are working to increase production in OPEC member countries, including some of the highest-risk regions in the Hub Group, Inc. Class A. President Trump's tough foreign policy is helping these companies to reach deals. Venezuela has the world's largest oil reserves and is also one of the most sought-after markets. After the arrest of former leader Nicolas Maduro by President Trump and the control of the country's oil exports, this country that was closed to American investors for a long time is now reopened. Sources reveal that the US government is also supporting Exxon Mobil Corporation and Chevron Corporation in negotiations in Iraq, Libya, Algeria, Azerbaijan, and Kazakhstan. The international expansion of these American oil giants is the latest case of Trump's disruption of the business norms of American companies, especially in industries like manufacturing, fossil fuels, and cryptocurrencies that he favors. While European oil giants, Shell, Total, and BP p.l.c. Sponsored ADR are also seeking expansion in the Middle East, the support of the US government gives Exxon Mobil Corporation and Chevron Corporation a competitive edge. "You will see American ambassadors promoting companies outside," said Samantha Power-Judd, a former senior State Department official who assisted American companies in expanding overseas during the Obama era and Trump's first term. "The way they drive this cooperation is something no previous government (even Republican governments) has ever had." Although large oil producers have been operating in OPEC+ countries for decades, opportunities for new projects have been limited due to resource-rich countries' control of the oil industry, stringent contract terms, and political unrest. In recent years, American giants have been more inclined to develop domestic shale oil businesses, helping the US surpass Saudi Arabia as the world's largest oil producer in 2018. But now, with host countries eager to win Trump's favor, gain implicit security guarantees from the US, and avoid tariffs, American oil executives feel that international growth opportunities unseen since the mid-2000s have arrived. Investments in some of the world's largest oil fields will mark further expansion of Trump's pursuit of American "energy dominance" and extend fossil fuel supplies into the 2040s. Oil Reserves Rankings by Country Of course, this comes with risks. In the 1970s wave of nationalizations in the Middle East, the core assets of most global giants were confiscated. Several attempts to return to the region since then have failed due to stringent terms and political instability. Exxon Mobil Corporation has faced asset nationalizations twice in Venezuela in the last 50 years, while the entire industry was forced to withdraw from Russia four years ago due to the Russia-Ukraine conflict. The oil market can also be unforgiving. Starting in the mid-2000s, Exxon Mobil Corporation and Chevron Corporation invested heavily in overseas mega-projects, only to face budget overruns, years-long delays, and heavy blows from oil price crashes in 2014 and 2020. But with domestic shale oil production in the US nearing a plateau, and oil demand stronger than many forecasters anticipated, US giants are looking for the next growth point. In recent months, executives from Exxon Mobil Corporation and Chevron Corporation have respectively met with officials in Iraq, Libya, and Algeria, with senior members of the Trump administration often accompanying. Special envoy Steve Witkoff facilitated a deal between Exxon Mobil Corporation and Azerbaijan in August. "The priority of energy dominance is highly consistent with what we are doing," said John Adair, head of exploration at Exxon Mobil Corporation, in an interview, "but it will not drive us into which countries or how to enter them." US special envoy for Syria, Thomas Barak, helped facilitate a similar agreement between Chevron Corporation and the Syrian government this week. Kuwait is also hoping to attract foreign investment by opening up some oil fields. "Pragmatic US energy policy, as well as improvements in regulations and fiscal terms in resource-rich countries, is creating an environment that supports responsible investment," said Clay Neff, upstream chief at Chevron Corporation, in an email statement. While many agreements in the Middle East are non-binding, all signs indicate that Exxon Mobil Corporation and Chevron Corporation are seriously negotiating for reserves replenishment in the next ten years and beyond. "Given the new, more aggressive strategy of the US government, we believe American giants are gaining disproportionate advantages," wrote Rajiv Bohatariya, capital Markets analyst at Royal Bank of Canada, in a brief, "which could provide resource acquisition opportunities that European counterparts cannot obtain." The biggest prize is the enormous oil reserves within OPEC and its allies, despite production restrictions. After the US invaded Iraq in 2003, Exxon Mobil Corporation operated one of Iraq's largest oil fields, West Qurna-1, but withdrew in 2024 due to insufficient profits despite huge oil reserves. Now, the surge in American oil supply is forcing OPEC countries to reconsider how to maintain global market share. Several countries are now indicating that they are willing to offer new terms in exchange for Western technology, knowledge, and capital needed to revitalize older oil fields. Adair said many governments are looking to replicate Guyana. In 2015, Exxon Mobil Corporation discovered oil there, and the current daily production is close to 1 million barrels. The South American country has recently become the world's fastest-growing economy, with critics suggesting that the commercial terms it reached with Exxon Mobil Corporation are overly favorable to the company. "Many governments realize that unleashing creativity and opening up to find suitable revenue-sharing frameworks is of greater value than never reaching goals and attracting minimal investments," Adair said. Exxon Mobil Corporation signed an agreement in October to study Iraq's giant Majnoon field. A few months ago, Chevron Corporation signed a similar agreement for the Nasiriyah project in southern Iraq. Before Lukoil PJSC agreed to sell most of its international assets to the Carlyle Group Inc group, both companies showed interest in taking over the West Qurna 2 field, which accounts for about 10% of Iraq's production. Some Iraqi political elites believe that the investment of American oil giants shows the country's independence from Iran and believe that deteriorating relations between the US and Iran will help win Trump's favor. Sources revealed that Iraqi officials are tired of Russia's slow development progress and believe that the presence of Exxon Mobil Corporation or Chevron Corporation will help the country avoid future impact from conflicts involving Iran, Israel, and the US. Substantial progress may be difficult to achieve before the formation of a new government in Iraq. The negotiation of power-sharing arrangements among factions has been postponed after the elections scheduled for November. However, officials in the current government have shown no hiding on their desire to cooperate with Exxon Mobil Corporation and Chevron Corporation. These two American oil giants have also expressed their intention to re-enter Libya after more than a decade post-war. As part of a plan to increase production by 40% by 2030, Libya is offering exploration blocks estimated to have 100 billion barrels of resources to foreign investors. Furthermore, American oil giants see opportunities in Europe, Africa, Central Asia, and the Caribbean. Since Trump took office a year ago, Exxon Mobil Corporation has expanded into Angola, obtained offshore drilling rights in Greece, won exploration concessions in Egypt, and signed production-sharing contracts near Guyana in Trinidad and Tobago. Chevron Corporation is in serious negotiations with Kazakhstan to extend its license for the Tengiz oil field, with production of 1 million barrels per day, signed contracts with Suriname, and increased this year's exploration budget by 50%. This oil giant has submitted bids for four offshore blocks in Greece and signed an agreement with Turkey this week. Neff said, "Chevron Corporation is actively seeking exploration opportunities to further strengthen and diversify our upstream investment portfolio." Negotiating with multiple governments allows oil companies to choose the best opportunities. Adair of Exxon Mobil Corporation said, "We will carefully select places with the best geological conditions, where we have the right business coordination with the government, and where the political risk is acceptable." This also helps achieve the best deals. "The more choices you have, the more chips you have," said former State Department official Power-Judd, "which allows you to step back in fiscal negotiations and say, 'Well, maybe this won't work, we want to go somewhere else.'"