What Would Cheaper Fuel Mean For Exxon Mobil Stock? Trefis Team Fri, November 13, 2026 at 10:20 AM EST 3 min read XOM +0.25% ^GSPC -0.80% CVX +0.92% COP +1.31% OXY +0.25% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
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Over the past twelve months, Exxon Mobil (XOM) stock returned 45.9%, compared with 12.2% for the S&P 500. On its October 30, 2026 call, management said the Middle East conflict had left diesel and gasoline in short supply and prices higher, and guessed that a return to normal would take well through 2027. Exxon still plans $20 billion of buybacks in 2027, assuming reasonable market conditions. So what would normal fuel markets mean for Exxon's cash?
How Much Cash Would Exxon Give Up?
If free cash flow fell back to the level of a year earlier, Exxon would give up about $19.2 billion a year. The company generated $43.0 billion of free cash flow in the four quarters to September 2026, compared with $23.8 billion in the four quarters to September 2025. That gap is not all from fuel: on the call, management said the fighting also constrained crude supplies.
That lower level would still cover the $17.3 billion Exxon paid in dividends over the past twelve months, but it would leave only about $6.5 billion toward the 2027 buyback plan.
The stock would also look less cheap. Exxon trades at 17.3 times its latest twelve months of earnings, against 21.9 for the S&P 500. Priced on the $30.0 billion Exxon earned in the year to September 2025, today's market value would be about 23 times earnings.
Exxon's Balance Sheet Has Room To Fill The Gap
Exxon has tapped its balance sheet to fill similar gaps before. In the weaker year to September 2025, the company still bought back $20.7 billion of shares, and its cash and short-term investments fell from $26.9 billion to $13.8 billion. On the October 30 call, management said that when times are tougher, Exxon does not pull back from its commitment and uses the balance sheet to supplement it.
The cash pile is smaller now, at $12.2 billion on September 30, 2026, but Exxon's debt is light. At the year-earlier level of free cash flow, the roughly $13.5 billion of the 2027 buyback not covered after dividends would exceed that cash. Total debt equals 4.9% of Exxon's market value, against 19.5% for the S&P 500. Over the past twelve months, operating income covered interest expense 55.6 times, and management said Exxon cut its net debt by more than $9 billion in the third quarter of 2026. A return to the cash flow of the year to September 2025 would test how long Exxon funds its buybacks from the balance sheet, not whether it can pay its debts.
What Would Show Exxon's Cash Slipping?
The first sign will come from Exxon itself. Instead of holding a December plan event, management said the company will reaffirm key 2027 planning metrics in a press release before the end of 2026, once the board approves the plan. Management also announced a fourth-quarter dividend of $1.07 per share.
A return to normal fuel prices would test Exxon's buyback plan well before it tested the company. Free cash flow against the total dividend bill is the figure to watch when Exxon reports its fourth quarter, expected in January 2027.
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