Trump administration eases greenhouse gas regulations; related energy stocks may benefit

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The Trump administration recently eased greenhouse gas emission restrictions, improving the regulatory environment for the energy industry. ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX), as global integrated energy giants covering the entire value chain from oil and gas production, transportation, to refining, have diversified businesses that effectively hedge industry fluctuations.

Both companies have significant financial advantages, with the lowest debt-to-equity ratios in the industry, and they can maintain operations and dividend payments during industry downturns by leveraging debt. Notably, they have achieved over 30 consecutive years of annual dividend growth. Currently, ExxonMobil’s dividend yield is 2.8%, and Chevron’s is 3.9%, both above market levels.

While regulatory relaxation benefits the entire industry, diversified giants may benefit more moderately compared to more focused companies. Due to potential regulatory reversals, ExxonMobil and Chevron, with their comprehensive strategies and solid financials, are better positioned for long-term resilience. In the context of energy transition and policy fluctuations, their stable income and risk resistance still hold investment value.

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