Why ExxonMobil, ConocoPhillips, and Shell Stocks Dropped Today

Group 1: Oil Price Decline - Brent crude oil prices fell 2.8% to about $71 per barrel, while WTI crude prices dropped more than 3% to about $67.50 [1] - The OPEC+ group plans to gradually increase oil production starting in October, contributing to the decline in oil prices [2] - China's economy is in contraction, with the Purchasing Managers' Index showing its worst numbers in six months, leading to decreased demand for crude oil [2] Group 2: Production Factors - Libya's current inability to produce oil is helping to stabilize prices, but its potential return to production could further depress prices [3] - Libya is capable of producing 700,000 barrels per day, which would be a significant catalyst compared to OPEC's planned output increase of 180,000 barrels per day [3] Group 3: Investment Opportunities - Oil stocks, including Exxon, Conoco, and Shell, have become cheaper, with Conoco having a P/E ratio of less than 12, Shell at 12.1, and Exxon at less than 14 [4] - Shell offers a 4% dividend yield, which is more generous than Conoco's 3% payout, and has the fastest projected earnings growth rate of over 8% [5] - The combination of an 8% growth rate, 4% dividend yield, and a P/E of 12 presents a favorable total return ratio for Shell [5]