Exxon Mobil Corporation XOM has signaled that U.S. oil and gas producers are unlikely to significantly ramp up production despite potential policy shifts under a future Trump administration. Speaking at the Energy Intelligence Forum in London, Liam Mallon, head of ExxonMobil's upstream division, emphasized that the industry remains focused on economic sustainability over aggressive drilling.

"We're not going to see anybody in 'drill, baby, drill' mode," Mallon stated. He highlighted that radical production increases are improbable as most companies prioritize financial discipline and operational profitability.

Mallon also echoed recent remarks by ExxonMobil CEO Darren Woods, affirming the company's support for the 2015 Paris climate agreement and the U.S. Inflation Reduction Act. The Act provides tax incentives for carbon capture, hydrogen production, and sustainable aviation fuel development areas gaining traction within the energy sector.

ExxonMobil's alignment with these initiatives underlines its growing commitment to transitioning toward lower-carbon energy solutions while maintaining robust core operations.

Former President Trump, campaigning on a pro-drilling agenda, has pledged to boost domestic oil and gas production. However, given current market conditions, the feasibility of such plans remains questionable.

The United States leads global oil production, averaging more than 13.4 million barrels per day. With crude oil prices hovering in the high $60s to low $70s per barrel, a production surge risks further depressing prices, challenging profitability for producers.

ExxonMobil's stance highlights its balancing act between maintaining profitable oil and gas operations and embracing emerging renewable energy opportunities. The company's emphasis on refining efficiency and low-carbon initiatives highlights its adaptive approach in a changing energy landscape.

XOM’s Zacks Rank & Key Picks

ExxonMobil currently carries a Zack Rank #3 (Hold).

Investors interested in the energy sector may look at some better-ranked stocks like Smart Sand, Inc. SND, FuelCell Energy FCEL and Nine Energy Service NINE, each presently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Smart Sand is a low-cost producer of high-quality Northern White frac sand, an ideal proppant for hydraulic fracturing and various industrial applications. The company provides proppant and other logistics services for several companies in the oil and gas industry. With sustained oil and gas market demand, SND is expected to see growing demand for its services, reflecting a positive outlook.

FuelCell Energy is a clean energy company offering low-carbon energy solutions. It produces power using flexible fuel sources such as biogas, natural gas and hydrogen. The company designs fuel cells that generate electricity through an electrochemical process that combines fuel with air, thereby reducing carbon emissions and minimizing the environmental impact of power generation. As such, FCEL is anticipated to play a crucial role in the energy transition by enabling industries and communities to shift from traditional fossil fuels to low-carbon alternatives.

Nine Energy Service provides onshore completion and production services for unconventional oil and gas resource development. The company operates across key prolific basins in the United States, including the Permian, Eagle Ford, MidCon, Barnett, Bakken, Rockies, Marcellus and Utica, as well as throughout Canada. With a sustained demand for oil and gas in the future, the demand for NINE’s services is anticipated to increase, which should position it for growth in the long run.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Exxon Mobil Corporation (XOM) : Free Stock Analysis Report

FuelCell Energy, Inc. (FCEL) : Free Stock Analysis Report

Smart Sand (SND) : Free Stock Analysis Report

Nine Energy Service, Inc. (NINE) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research