After soaring in recent days, with a 21% increase in YTD at the back of the gamma compression discussed yesterday, and along with a barrage of analyst updates, most recently from Barclays and JPM, the Exxon shares have fallen to 4% this morning, after the WSJ reported that the SEC launched an investigation into the energy giant after an employee “filed a whistleblower complaint last fall alleging the energy giant was overvalued one of its most important properties of oil and gas “.
According to the WSJ, in the latest and fun “whistleblower complaint,” several people participated in the valuation of a key asset in the Permian Basin, currently the U.S.’s most productive oil field. “it was complained during an internal evaluation in 2019 that employees were being forced to use unrealistic assumptions about how quickly the company could drill wells there to reach a higher value ”.
According to a person familiar with the matter, at least one of the employees who complained was fired last year. The Journal previously reported that there had been internal disagreements over the valuation.
Which is fantastic … the only problem is that absolutely any other American E&P and shale company, and in fact every period of the energy company, uses a similar “unrealistic” approach to valuing the assets. In fact, it can be argued that Aramco is the biggest criminal of all, although there may be other “considerations”.
The news was enough to beat the shares, which dropped to $ 48.3 before recovering, as traders realized that Exxon is doing nothing that not all of its peers are doing.
For Zerohedge.com
More highlights from Oilprice.com:
Return to the home page