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XOM · Forward model · Chemical Products · Bear case

What has to happen in Chemical Products

Model as of

This page changes Chemical Products inside the complete XOM model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

XOM forward model
Horizon
Consolidated fair value $87.39 all other verticals held in this portfolio case
Final-quarter revenue $4.86B 7% of company revenue
Explicit segment contribution $9.94B EBITDA less segment capex, before corporate items

The disruption ends. Brent returns from $104.52 to the $63.69-69.07 of 4Q25 and 3Q25 and the indicative refining margin from $29.0/bbl to $17.5-18.3, which at the disclosed sensitivities of $700M and $800M of annual earnings per $1/bbl removes roughly $25-28B and $9B of annualised earnings. This case needs no demand recession. The disclosed Strait of Hormuz downside - about 750 koebd of Middle East production against 2025 if the Strait stayed closed through 3Q26 - is a single-quarter outage that no persistent level step can represent, so it is carried here as a deeper and faster price and margin reversion rather than as a volume step.

Chemical Products

Basis quarter$7.05B
Final quarter$4.86B
Implied CAGR−7%
Final revenue mix7%

Steam crackers turn advantaged North American feedstock into polyethylene and other commodity petrochemicals. Sales tonnage is disclosed every quarter and the North American polyethylene marker is disclosed alongside it, so volume times revenue per tonne is both the reported shape and the one the disclosed sensitivities move.

Last four quarters
2025 Q3 $5.93B Reported
2025 Q4 $5.54B Estimated
2026 Q1 $5.61B Reported
2026 Q2 $7.05B Reported
Polyethylene and other commodity petrochemicalsPerformance chemicalsProxxima resin systems, pre-scale, with FID taken for a 120 kt/y Louisiana blending expansion
Units 4471000/qtr growing +5.0% per quarter 4,471 kt sold in 2026 Q2, the lowest tonnage in the ten-quarter reconciling window.
Price per unit $1578 drifting −11.0% per quarter $1,577.72 per tonne at a $1,454/T polyethylene marker; reverts toward the $965-1,166 of 2025.
Chemical Products

Latest: $4.86B (2031Q2E)

Period Value
2024Q1 $6.11B
2024Q2 $6.03B
2024Q3 $6.10B
2024Q4 $5.44B
2025Q1 $5.57B
2025Q2 $5.84B
2025Q3 $5.93B
2025Q4 $5.54B
2026Q1 $5.61B
2026Q2 $7.05B
2026Q3E $6.51B
2026Q4E $6.11B
2027Q1E $5.82B
2027Q2E $5.60B
2027Q3E $5.43B
2027Q4E $5.31B
2028Q1E $5.22B
2028Q2E $5.15B
2028Q3E $5.10B
2028Q4E $5.06B
2029Q1E $5.03B
2029Q2E $5.00B
2029Q3E $4.97B
2029Q4E $4.95B
2030Q1E $4.94B
2030Q2E $4.92B
2030Q3E $4.90B
2030Q4E $4.89B
2031Q1E $4.87B
2031Q2E $4.86B

Assumptions & reasoning

  • The 4,471 kt of the basis quarter is the lowest tonnage in the ten-quarter window while revenue per tonne of $1,577.72 is the highest, so 2026 Q2 was a margin quarter and not a volume quarter. The 5% first-quarter volume growth recovers toward the 5,325 kt the segment averaged in 2025, not toward a new high.
  • The model's FY2030 tonnage of 22.0 Mt falls short of the ~23.0 Mt 2030 plan. That gap is deliberate: the base case gives the plan's volume trajectory most but not all of the credit, and the bull case is where it lands in full.
  • Terminal margin is set from the reported segment note, not from the disclosed per-tonne unit earnings. Unit earnings of ~$210/T on 21.3 Mt would imply about $4.5B of 2025 Chemical earnings against the $800M the four 2025 quarters actually reported, so the two measures cannot be reconciled here and only the reported one is used.
  • The North American polyethylene marker of $1,454/T in the basis quarter is 92% above 4Q25's $759/T, and the disclosed sensitivity is $560M of annual earnings per $100/T, which is large against what this segment earns in an ordinary year.
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