Veteran market strategist Jay Woods has identified ExxonMobil as one of his three favorite stocks for 2026, anticipating a 10% market correction next year. In his latest investor note, Woods cites the historical pattern of an 18-month pullback in equity markets and highlights key macro catalysts: the appointment of a new Federal Reserve chair, midterm election turnover in Congress, and potential shifts in U.S. fiscal policy. Woods argues that ExxonMobil’s diversified upstream and downstream operations will provide defensive ballast during broad market volatility, thanks to the company’s exposure to long-cycle oil projects in Guyana and the Permian Basin as well as stable cash flow from its refining and chemicals businesses.

ExxonMobil’s downstream division has posted resilient performance over the past two quarters, driven by a combination of lower Brent-WTI differentials and a global shortage of middle distillates. The company’s recent upgrades at the Beaumont and Baytown refineries increased utilization rates by approximately 4 percentage points, pushing throughput to an average of 1.9 million barrels per day in Q4. Margins on diesel and jet fuel improved by nearly 15% year-over-year, according to management commentary, and ExxonMobil expects these tailwinds to persist into 2026 as scheduled maintenance at competitor facilities tightens regional product availability.

While ExxonMobil remains one of the world’s largest integrated oil producers, management has signaled a pivot toward natural gas as the primary growth vector over the next decade. The company’s LNG export terminals in the Gulf Coast region processed a record 1.2 billion cubic feet per day in 2025, up 10% from 2024 levels. Meanwhile, new discoveries offshore Guyana and incremental drilling in the Marcellus and Permian basins are expected to boost total gas production by 8% annually through 2028. Investors are also eyeing ExxonMobil’s recently finalized joint venture to develop a third LNG export train, which could add another 5 million tonnes per annum of liquefaction capacity by the end of the decade.