Chevron Corporation and Shell plc are major energy companies drilling for oil and gas in the Gulf of America (GoA), which accounts for approximately 14% of U.S. crude oil production. Chevron is targeting a production increase to 300,000 net barrels per day by 2026, up 50% from 2020 levels, with projects like Ballymore and Whale expected to contribute 75,000 and 100,000 barrels per day, respectively. Shell, the largest producer in GoA, includes major projects such as Perdido and Stones, employing innovative designs to enhance efficiency and cost control.
As of now, Chevron’s stock has dipped 3.3% over the last year while Shell’s stock has remained stable, dropping just 0.1%. Valuations show Chevron trading at 18.26 times forward earnings versus Shell at 11.29 times, potentially indicating investor expectations for Chevron’s higher profit margins. Earnings projections estimate a 27% EPS drop for Chevron in 2025, with a 23% rebound in 2026, while Shell anticipates a 20% decline followed by a 10% increase.
Both companies have a Zacks Rank #3 (Hold), though Chevron appears positioned slightly better with defined production targets and prospects for growth. Investors may find both stocks appealing for exposure to the Gulf’s evolving energy landscape.
