As ExxonMobil (XOM) predicts a 35% increase in global energy demand by 2040, the company's shares have soared to a new 15-month high on a deal with Russia's Rosneft and news of declining unemployment claims.
It's been a stellar year for Exxon Mobil, with shares rising 1.6% to $100.81 in intra-day trading on 26 December, and increasing 16% over the course of this past year.
Exxon is now one of the cheapest Dow stocks and while its earnings and revenues dropped this year, it still managed to outperform the industry average.
The rise in share prices was a response to Exxon's 26 December announcement that it was forming a joint venture with Russian oil and gas giant Rosneft NK OAO to launch a pilot program to drill horizontal wells and revive old wells in Western Siberia.
Earlier this year, Exxon's undervaluation, coupled with expected rises in oil prices, led Warren Buffet to purchase a $3.4 billion stake in the company.
In its annual outlook, Exxon said that more efficient, energy-saving programs and technologies, increased use of natural gas and other less-carbon intensive fuels, and continued development of advanced exploration and production technologies will support a 35% increase in global energy productivity by 2040.
Crude oil demand is expected to increase 25%, according to the outlook, led by increased commercial transportation activity, and will be met through technology advances that enable deepwater production and development of oil sands and tight oil.
The outlook also noted that unconventional gas now accounts for 40% of the world's resource base, and is expected to represent 65% of global gas production growth to 2040, led by North America, according to the Oil & Gas Journal.
Most of the projected demand growth will occur in developing nations, while industrialized nations focus on improving energy efficiency.
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com More