Chevron and Exxon attempt to merge as executives reportedly met up amid the pandemic and devastating oil prices

Chevron Corp and Exxon Mobil Corp chief executives reportedly discussed a possible merger last year. They are considering putting together their oil companies and work to get back what they have lost due to the COVID-19 pandemic.

The merger talks between Chevron and Exxon

Although the need for oil supply continued even at the time when the pandemic is hitting many businesses badly, the two oil giants were not spared and suffered from big losses. With the devastating outcomes and dropping oil prices, Exxon and Chevron talked about incorporation.

It was said that it appears that two companies are “testing the waters,” and if this will be a reality, it will be one of the biggest corporate mergers ever. In any case, as per The Wall Street Journal, Exxon Mobil CEO Darren Woods and Chevron chief Michael Wirth spoke about the potential merger when the pandemic crisis started to negatively affect the oil prices.

Around that time, the shrinking demand for oil and gas placed both Chevron and Exxon in massive financial strain. This was the main reason why the executives started to consider a merger and check if it can be done.

But then again, the report noted that Woods and Mirth’s meeting was only preliminary, and the talks about the merger is not an ongoing activity between Chevron and Exxon.

However, if this will push through, such a deal will surely be one of the most remarkable in this era since the combined market value of the firms could go over $350 billion, with Exxon making up the $190 while Chevron’s is $164 billion.

Benefit from the merger

At any rate, if Chevron and Exxon will merge, there are many benefits from the deal. Together, they can produce more oil so they can supply faster than their competitors. They can also collectively work on issues that oil companies are not immune to.

Lastly, Bloomberg reported that an industry analyst from Sankey Research, Paul Sankey, stated that the reason why the Exxon and Chevron merger makes sense is that both sides can benefit greatly from the deal.

“Chevron for ExxonMobil is a great idea,” he said. “It would be a truly bottom of the cycle, counter-cyclical move of the kind the equity market is more-or-less demanding.”