Forced frenemies, Exxon and Chevron take diverging paths as leaders of the booming Permian

Finance·Big OilForced frenemies, Exxon and Chevron take diverging paths as leaders of the booming PermianBy Jordan BlumBy Jordan BlumEditor, EnergyJordan BlumEditor, EnergyJordan Blum is the Energy editor at Fortune, overseeing coverage of a growing global energy sector for oil and gas, transition es, renewables, and critical minerals.SEE FULL BIO Chevron chairman and CEO Mike Wirth.Jeenah Moon—Bloomberg/Getty ImagesThe top Big Oil giants in the Western Hemisphere, Exxon Mobil and Chevron also are the top ducers in the booming Permian Basin—but they’re pledging to take very different paths going forward

The two companies reported their earnings Aug. 1 just two weeks after they were reluctantly forced into becoming partners when a ruling from a contentious arbitration fight in Chevron’s favor allowed the company to close on its $53 billion acquisition of Hess and its crown jewel 30% stake in Exxon’s oil discovery offshore of Guyana—arguably the biggest oil discovery of the century

However, for both companies, the Permian is their leading base of oil and gas volumes

Exxon reported growing its volumes to 1.6 million barrels of oil equivalent a day, including natural gas, while Chevron hit its 2025 target of 1 million barrels daily during the second quarter

Chevron aims to keep its Permian output relatively steady going forward. “We’re very pleased to have such a large shale portfolio and, at some point, growth is less the objective than free cash flow, and we’re apaching that point,” said Chevron chairman and CEO Mike Wirth in an earnings call

Exxon chairman and CEO Darren Woods said he “absolutely” disagrees with the idea of “peak” Permian oil duction amid weaker prices and a maturing basin

Everybody in the unconventional [shale] space is playing the short game,” Woods said, citing scale and nology advantages that lead to much greater cost efficiencies, allowing for more value-oriented growth. “That has led us to have growing confidence the jection we have past 2030 is an upward vector and will continue to grow.” Woods said Exxon is even open to more acquisitions going forward—just not growth for the sake of growth

Any deal must ve “one plus one equals three.” “That is, in my mind, the magic of successful acquisitions and what we’re looking for,” Woods said

Exxon and Chevron both dered quarterly beats, but their earnings are down in a lower oil price environment

Hotly anticipated ruling In Guyana, the long-awaited ruling from an arbitration panel overseen by the International Chamber of Commerce decided July 18 that Chevron’s acquisition of Hess did not violate Exxon’s right of first refusal for Hess’ Guyana stake because it bought the whole company and not just the Guyana position

Although most industry observers expected Chevron to prevail, Woods said Aug. 1 that the ruling was a “surprise.” “We were highly confident in our position,” Woods said. “Having co-written the contract, we understood its intent and believed the contractual language conveyed it

Unfortunately, the tribunal interpreted it differently

While disappointed, we respect the cess and the ruling.” Woods said the d Guyana duction volumes should grow to at least 1.3 million barrels of oil equivalent daily by 2030

For Chevron, the Hess and Guyana acquisition helps offset “disappointing” global oil and gas exploration results in recent years

The company had leaned in on onshore U.S. volumes, cost reductions, and long-cycle international developments that were in development, Wirth said

Exploration will grow going forward, he said. “But overall, our MO (modus operandi) or our reputation for capital discipline will remain.” Introducing the 2025 Fortune 500, the definitive ranking of the biggest companies in America

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