S&P Global Ratings has revised its outlook on Exxon Mobil Corp. to positive from stable and reaffirmed the company's long-term issuer credit rating at 'AA-'. The agency pointed to expectations that Exxon will produce substantial free operating cash flow across the next two years even as the company faces reduced activity in the Middle East.
In its assessment, S&P projected that key credit metrics will remain strong through the coming 24 months. The ratings firm expects funds from operations to debt to comfortably exceed 60% and free operating cash flow to debt to remain above 40% under its base-case price assumptions of $50 per barrel West Texas Intermediate crude, $55 per barrel Brent and $2.75 per million Btu of Henry Hub natural gas.
Alongside its long-term rating action, S&P affirmed Exxon's 'A-1+' short-term and commercial paper ratings and the 'AA-' issue-level rating on the company's unsecured debt. The ratings agency signaled that the positive outlook reflects confidence in Exxon's balance sheet strength, portfolio diversification and near-term growth from developments in Guyana and the Permian Basin.
S&P said it expects higher commodity prices and progress across Exxon's Permian, Guyana and liquefied natural gas assets to more than counterbalance cash flow losses tied to decreased Middle East activity. The agency noted that Middle East production represented roughly 20% of Exxon's output in 2025.
Production milestones cited by S&P include Exxon's reach of 1.7 million barrels of oil equivalent per day in the Permian Basin in the first quarter of 2026, a step toward the company’s stated target of 2.5 million barrels per day by 2030.
S&P also described disruptions to Exxon's LNG exposure in Qatar: the company holds stakes in two LNG trains at Ras Laffan that were damaged and are expected to remain out of service for three to five years. Complementing that loss of capacity, Exxon has its first LNG train online at Golden Pass in Sabine Pass, Texas. The company expects its second Golden Pass train to be mechanically complete by the end of 2026 and the third by mid-2027.
On shareholder returns, S&P projects Exxon to continue paying $17 billion to $18 billion in dividends in 2026 and to deploy about $20 billion toward share repurchases. Those distributions form part of S&P’s view of the company’s financial policy and capital allocation under the scenarios it modeled.
The ratings agency set clear thresholds tied to the outlook. It said it could move the outlook back to stable if funds from operations to debt fell below 60% or free operating cash flow to debt dropped below 40%. Conversely, S&P indicated it could raise its ratings if Exxon sustained a disciplined financial policy with funds from operations to debt above 60% and free operating cash flow to debt above 40% over a prolonged period.
Sector implications
- Energy: Credit metrics and production trends at a major integrated oil company influence financing conditions and investor expectations across the oil and gas sector.
- Financial markets: S&P’s outlook shift may affect perceptions of creditworthiness for corporate issuers in energy and related supply chain financiers.
- Commodities: The agency’s price assumptions for crude and natural gas form an explicit part of its stress-testing for Exxon's cash-flow projections.