Kind of a one-two punch out of ExxonMobil’s senior vice president, Neil Chapman, today.
On one hand, a not-so-surprising announcement tying up the loose ends of Exxon’s corporate existence. The company, which has long been legally homeported in increasingly business-unfriendly New Jersey, would move that as well, thanks to stockholders giving executives the thumbs-up.
…Chapman delivered his message on the same day that Exxon shareholders approved a plan to move the company’s legal home from New Jersey to Texas.
Citing Texas’ strong regulatory environment, ExxonMobil CEO Darren Woods said the state was a better fit for the company in a statement.
“Aligning our legal home with our operating home, in a state that understands our business and has a stake in the company’s success, is important.”
ExxonMobil already moved its headquarters to Texas in 1989 and all of its corporate leadership work from the Lone Star state already. The company said 75% of it’s U.S.-based workforce already work in Texas as well.
What was kind of interesting about the move, besides the fact that so much of Exxon had already moved out of the state, was the reaction of the Washington Post Editorial Board, of all groups.
Exxon says goodbye to New Jersey
Companies don’t need to tolerate hostile courts and state regulators.
…In March, Exxon’s board of directors unanimously recommended relocation to Texas, to take advantage of its friendlier business climate. The proposal passed this week at a shareholder meeting with over 70 percent support.
It isn’t difficult to imagine why Exxon wants to move its legal responsibilities from a state that has tried to sue major oil companies to the country’s hydrocarbon capital. CEO Darren Woods said the relocation would situate the company in a state “with legislators, judges and juries” who “understand our business and our contributions to society.”
The Lone Star State has lured businesses and residents from blue states with a less burdensome regulatory environment and lower taxes. But Texas’s attention to business law has also played a part. In 2024, it established the Texas Business Court with judges appointed by the governor. The court is friendlier than alternatives in blue states.
…Not everyone is happy. New York City Comptroller Mark Levine (D) urged Exxon shareholders to vote against the relocation because it would “disenfranchise” them. Proxy advisories Glass Lewis and Institutional Shareholder Services claimed it could limit shareholder rights.
…Politicians like to blame companies for acting in their self-interest, but that’s the easy way out. If New Jersey and Delaware want to retain companies, let alone attract them, they need to take a hard look at what they’re doing to drive so many away.
My X buddy John Clark, a refinery type himself, sent me the article with a note about the editorial’s almost 800 comments.
Holy SMOKES. These people are nuts!
But it all boils down to a huge WAAH, and the punitive threats of retribution from both the New York and New Jersey authorities are only serving to prove the editorial’s point. Who needs to stick around for this kind of abuse?
ADIOS, MUCHACHOS!
As interesting as that was, it was what Chapman had to say about oil inventories that sent a chill down listeners’ spines.
“Approaching Unheard Of Inventory Levels”: Exxon, Chevron Issue Apocalyptic Warning About What Happens Next To Oil https://t.co/se1FhyCrKN
— zerohedge (@zerohedge) May 29, 2026
The VP warned that oil prices were held artificially low by releases from strategic oil reserves across the globe, and that those were all running dangerously low. When those critical levels were breached, oil at $150 to $160 a barrel was going to happen nearly overnight.
Senior Vice President of ExxonMobil Neil Chapman issued a warning that energy prices could rise sharply in the near future, on the same day the company’s board approved moving its corporate structure from New Jersey to Texas.
Speaking at the Bernstein Conference in New York on a Thursday, Chapman stated that crude oil prices could reach $160 per barrel in the coming weeks as reserve inventories reach their lowest point. He described current inventory levels as unprecedented and very low, noting that once those low levels are hit, prices will surge. Chapman attributed the recent period of lower prices to the release of strategic petroleum reserves by multiple Western nations.
Chapman explained that commercial inventories of crude oil, gasoline, diesel, and jet fuel have all been depleted, and that releasing strategic petroleum reserves has helped mitigate the impact on prices. He warned that the dated Brent crude benchmark, a key global price reference, would climb to $150 or $160. He noted that crude oil has been trading between $90 and $110 for roughly six weeks, which he said was only possible due to running down inventories, adding that this cannot continue indefinitely.
Besides the SPR additions, the fact that China hasn’t been buying oil at its normal rate has helped stabilize the price at artificially low levels. When the Chinese come back into the market, that will cause its own scramble to fill those tankers.
China’s crude imports just collapsed from 12,000 kbd to 6,500 kbd.
The oil shock hasn’t happened yet because China hasn’t come back to buy.
Chinese refiners stepped back.
High prices, weak margins, no incentive to buy.But inventories are now drawing down faster than run… pic.twitter.com/zc5P4cR0xj
— Jack Prandelli (@jackprandelli) May 25, 2026
Other analysts point out that even if the Strait of Hormuz opened tomorrow, it would not bring the flows back to normal levels for at least four months. Chevron’s CEO is pretty much on board with Chapman’s dire assessment.
🚨Chevron’s CEO just said June and July will be worse.
Exxon says $150–$160 oil in 2–3 weeks.
ADNOC says Hormuz won’t fully recover until 2027.
The buffer is gone but the price hasn’t moved yet🛢️
Mike Wirth, Chevron CEO:
“The buffers and the shock absorbers are being… pic.twitter.com/JcPJgneKVN— Jack Prandelli (@jackprandelli) May 29, 2026
…”The buffers and the shock absorbers are being steadily drawn down. The ability for the market to absorb this imbalance is drastically diminished today versus where we started.”
“Over the next few weeks, we’re likely to see those pressures flow through more directly to physical prices more upward pressure into June and certainly July.”
This is the CEO of the world’s 3rd largest oil company.
Speaking at a major institutional conference.
Warning that the next 60 days will be worse than the last 90⚡
Why Wirth is right and why markets haven’t priced it
📉Oil dropped 10% this week on Iran deal optimism.
Wirth’s response to that, the physical market doesn’t care about negotiations…. It cares about barrels.
3things held prices down since February 28:
→ Higher than normal pre-war inventory cushion
→ Record 400 million barrel strategic reserve release by IEA members
→ Continued flows of sanctioned Iranian, Russian and Venezuelan oil
All 3 buffers are now used or nearly so.
“These stocks are now running low.” Wirth 📊
Wirth wasn’t alone.
ExxonMobil SVP Neil Chapman:
“We’re approaching unheard of inventory levels. Really, really low levels. Once you get to that point $150, $160 demand destruction brings it back into balance.”
Timeline: 2–3 weeks.
Even if a deal is signed tomorrow ADNOC Group CEO Sultan al-Jaber was explicit on May 21:
“It will take at least 4 months to get back to 80% of pre-conflict flows. Full flows will not return before Q1 or even Q2 2027.”
The market is pricing a deal as if reopening Hormuz is a light switch.
It isn’t.
It’s a 6–12 month process minimum insurance markets, shipping restarts, infrastructure repairs, production ramp-up.
I have no doubt this is all part of the squeeze play on both sides – Iran thinking if they can just hold out, and Trump knowing what he and the Arab allies have left in the tank.
There have been some surprising players stepping in the interim…
In just seven years, Guyana has become one of the fastest-growing oil exporters and global economies and an oil-producing powerhouse with nearly 1 million barrels per day of production capacity. And the war in Iran is only turning up the heat even more.
Since ExxonMobil launched production from the offshore Stabroek block in 2019, Guyana’s economy has quadrupled. Oil revenues and royalties have boosted income for the state coffers and gross domestic product (GDP) linked with oil-related activities.
Now Guyana, which was one of the poorest South American countries and has fewer than 1 million citizens, is poised to materially increase its oil revenues and its position on the global oil map as the war in Iran has hiked international oil prices and has buyers scrambling for crude from outside the Middle East region.
Guyana, of course, is not out of the woods yet as regards the so-called resource curse, typical of many new resource hotspots which have tended to waste through the decades the opportunities their natural resources – oil, gas, metals, or minerals – have offered to their economies.
…but it still will not be enough to stave off an oil shock of magnitude.
It sure would have been nice if POTATUS had put back more than 59M bbls of the 250M+ bbls he drew out.
It’s getting a little tight.
The U.S. Strategic Petroleum Reserve (SPR) is less than 10 days away from falling to its lowest level since August 1983- over 15,625 days ago- a level not seen since the SPR’s initial fill-up that began in 1977.
— Patrick De Haan (@GasBuddyGuy) June 1, 2026
Sure would be nice if they’d settle this thing one way or the other. I know I have my druthers how I’d like that done – always been fond of BIG BADDA BOOMS – but time to get off the pot.
Period.
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