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Shares of ExxonMobil Corporation XOM gained more than 2.25% in morning trading Monday as new reports suggested that President-elect Donald Trump will, in fact, nominate CEO Rex Tillerson for secretary of state. Oil prices were also soaring on the news that Russia and several other nations will join OPEC members in cutting output next month.
Tillerson has surfaced as Trump’s top choice to head the State Department over the past few weeks, however, the latest round of rumors comes from two transition team sources contacted by Fox News. According to these people, nothing is quite official yet, but Trump is expected to make the announcement within the next few days.
Trump has spoken highly of Tillerson’s leadership of ExxonMobil, but some critics have been quick to point out his company’s ties with Russia and his personal relationship with Vladimir Putin. In fact, former presidential candidate Sen. Marco Rubio tweeted out a thinly-veiled warning directed towards Tillerson on Sunday:
Being a “friend of Vladimir” is not an attribute I am hoping for from a #SecretaryOfState – MR
— Marco Rubio (@marcorubio) December 11, 2016
The president-elect also took to Twitter to defend Tillerson:
Whether I choose him or not for “State”- Rex Tillerson, the Chairman & CEO of ExxonMobil, is a world class player and dealmaker. Stay tuned!
— Donald J. Trump (@realDonaldTrump) December 11, 2016
Tillerson’s possible appointment will come back on the back of President Obama ordering a full congressional investigation into Russian hacking related to the election. After a CIA report found that Russia’s involvement in the election went beyond undermining the strength of America’s democracy and intentionally worked to help Trump win, Obama and a bipartisan group of congressional leaders have cried foul.
With tensions between the United States and Russia rising yet again, Tillerson may face an uphill battle for confirmation based on his relationship with Russia. While it certainly makes sense that a big-oil chief would do business with one of the world’s largest producers of the commodity, that sort of thing probably won’t play well as members of the DNC and GOP look to crack down on Putin.
In separate Russian news, the country joined the non-OPEC nations of Mexico, Kazakhstan, and Oman in agreeing to cut oil product in the wake of the cartel’s decision to slash production by nearly 1.2 billion barrels a day (b/d). The non-OPEC group will aim to cut production by 558,000 b/d starting in January.
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