Big Oil Done Right

Chevron $CVX ( ▲ 3.34% ) just received an upgrade from JPMorgan $JPM ( ▼ 0.17% ), which moved the stock to Overweight from Neutral.

The call comes as Chevron delivers early wins from integrating Hess Corporation and accelerates its cost cuts.

JPMorgan’s new price target is $176, signaling about 5% upside from today’s close.

That might sound like a modest gain, but it signals what the bank sees as rare stability amid uncertainty in the sector and beyond.

JPMorgan analyst Arun Jayaram told clients that Chevron has already achieved its initial $1 billion synergy target from the Hess acquisition and now aims for $3 billion to $4 billion in annual cost savings by 2026.

Those savings could potentially expand free cash flow and improve margin resilience.

Key catalysts cited by the analyst include Chevron’s world-class Yellowtail project in Guyana and the Tengizchevroil project in Kazakhstan, which JPMorgan expects to generate strong cash contributions in 2026 and 2027.

Chevron is also pursuing new opportunities, such as exclusive talks to help build a natural gas-powered generation facility for a major data center. It’s a move that could diversify cash flow beyond traditional oil and gas, per Jayaram.

For Chevron, execution of the Hess integration and its cost-cutting program remains central to JPMorgan’s thesis. Achieving targeted synergies and sustaining cost discipline could underpin stronger cash flow well into 2026 and beyond.