Big Oil Faces Trump DOJ Probe; Chevron Powers Data Centers

ExxonMobil ($XOM), Chevron ($CVX), and ConocoPhillips ($COP) slipped in overnight trading as the Trump administration ordered a DOJ investigation into alleged gasoline price gouging by major oil companies. President Trump stated that crude prices are "dropping like a rock" while customers are "being gouged" at the pump, according to reports. The probe marks an escalation in political pressure on integrated majors despite broader crude market weakness.

Separately, the U.S. Supreme Court ruled 6-3 in favor of $XOM in its lawsuit against Cuban state-owned firm Corporación CIMEX, making it easier for U.S. companies to seek compensation for property seized decades ago by Fidel Castro's government. The case involves a refinery and service stations that once belonged to Standard Oil, Exxon's corporate predecessor. Occidental Petroleum ($OXY) trades at 7-9x forward P/E after first quarter 2026 results, though analysts cite falling revenue and free cash flow volatility as concerns.

Chevron ($CVX) and Microsoft announced a 20-year power purchase agreement to build a natural gas-fired power plant in West Texas dedicated to supplying electricity to a Microsoft data center campus. The project, named Project Kilby, sits on more than 2,000 acres in Reeves County and represents a significant bet by both companies on the AI-driven data center buildout. Texas Pacific Land Corporation announced an agreement to provide land and water solutions to $CVX for the large-scale power project.

The deal highlights the growing intersection between traditional energy companies and technology infrastructure, as hyperscalers seek reliable, long-term power supplies to support AI compute expansion. Natural gas-fired generation offers baseload capacity that renewable sources cannot yet match for 24/7 data center operations.

Southern Co. ($SO) reached $94.93 at the close, reflecting a +1.61% change compared to its last close, while Duke Energy ($DUK) reached $125.05, up +1.24% in a session where broader markets declined. The utility sector showed relative strength as investors rotated into defensive, regulated names with stable cash flows and dividend yields.

Utilities continue to benefit from grid infrastructure investment needs and power demand growth tied to data center expansion. Rate case activity and transmission buildout programs support earnings visibility for regulated utilities amid broader energy market volatility.

First Solar ($FSLR) scored as a decent value stock with a P/E of 16, strong profitability, and solid growth, according to ChartMill analysis. The company appears undervalued relative to its industry peers and offers a margin of safety for patient investors, analysts noted. The Invesco Solar ETF rose 82.81% over the past year, though fee structures remain a consideration for long-term holders.

Solar capacity additions continue to benefit from policy incentives and falling module costs, though valuation discipline remains important as the sector matures. First Solar's domestic manufacturing footprint positions it to capture U.S. incentive programs under current energy policy frameworks.

Valero Energy ($VLO) faces ongoing volatility in global oil markets, though its highly complex refining system and Gulf Coast network help sustain profits through varying crack spread environments. The company's operational flexibility allows it to process heavier, discounted crude grades and optimize product slate based on market conditions.

TechnipFMC secured a contract valued between $75M and $250M for subsea infrastructure work on Angola's Greater PAJ Project, boosting second-quarter 2026 inbound orders with deepwater flowlines and risers. Italian engineering firm Saipem and France-based Technip Energies are among public companies constructing pipelines and other installations in the Middle East as Iran prepares oil infrastructure tolls. U.S. oil production outlook remains subject to evolving drilling activity, with midstream infrastructure tailwinds potentially materializing more fully in 2027.

EOG Resources ($EOG) scheduled a conference call and webcast to discuss second quarter 2026 results for August 5, 2026, at 9 a.m. Central time. Investors will focus on production guidance, capital efficiency metrics, and management commentary on oil and gas price realizations amid current market dynamics.

The DOJ investigation into oil majors' gasoline pricing practices could create headline risk in coming sessions, though fundamental supply-demand dynamics and crude price trends will likely drive longer-term sector performance. Weekly EIA inventory reports and Baker Hughes rig count data remain key inputs for assessing production trajectories and storage levels.