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US stock market cedes ground on Tuesday, but Chevron stock rallies on higher oil prices

  • CVX gains over 1.8% as WTI Oil gains 2.6% on Tuesday.
  • President Trump says he has not reached out to Iran for peace talks.
  • Apollo Management is concerned that higher Oil prices could kick off inflation.
  • Chevron invests in lithium acreage, TotalEnergies partners with Chevron on exploration leases.

US stocks opened lower on Tuesday after it became clear that the Israel-Iran war was not about to end quickly. US President Donald Trump left the G7 meeting early on Monday to attend to the conflict, and the US military has positioned refueling jets closer to the conflict, a sign that it may take a stronger role in fighting alongside its ally Israel. Despite calling for “a broader de-escalation of hostilities”, Trump posted the following on social media:

Truth Social June 17, 2025 President Donald Trump post

Truth Social June 17, 2025 President Donald Trump post

Global stock markets are also mostly down on Tuesday, particularly the French and German bourses, after the G7 agreed on a statement that backed Israel's unilateral bombing of Iranian military officials, civilian scientists and nuclear facilities that began last Thursday.

WTI Oil rose more than 2.6% at the time of writing on Tuesday morning, trading at $73.56, a market dynamic that Apollo Global Management said earlier this week could lead to stagflation. This has helped Chevron (CVX) stock lead the Dow Jones Industrial Average (DJIA) on Tuesday despite the index falling roughly a quarter of a percentage point.

Apollo worries over oil rally's effect on inflation, GDP

Investment firm Apollo Global Management is adamant that the higher Oil prices seen since the start of Israel's attack on Iran could heavily effect the US economy this year if they remain this high or even gain steam. WTI has gained nearly $18 off its recent lows in early May.

"According to the Fed’s model of the US economy, a sustained $10 increase in oil prices is expected to increase inflation by 0.4% (including secondary effects) and lower GDP by 0.4%," Apollo's Chief Economist, Torsten Slok, said in a client note.

What's more, Slok added, "In short, higher Oil prices exacerbate the ongoing stagflation shock stemming from tariffs and immigration restrictions."

Slok said that the market will look to whether the Federal Reserve (Fed) focuses on inflation concerns or GDP concerns at its FOMC meeting, which concludes on Wednesday with a press conference.

Chevron stock news

For its part, Chevron is focused on other commodities than Oil on Tuesday. The company announced that it has acquired 125K net acres within the Smackover formation spanning northeast Texas and southwest Arkansas from TerraVolta Resources and East Texas Natural Resources.

While financial details were not released, the formation is known for high lithium content, and Chevron executives said they would directly mine the mineral used in batteries using direct lithium extraction technology.

Based on WARNTracker.com, Chevron is expected to layoff as many as 50 employees on July 1. The Worker Adjustment & Retraining Notification Act of 1988 requires large employers to provide at least 60 days' notice to employees and state officials ahead of mass layoffs.

In other news, French oil major TotalEnergies (TTE) acquired a 25% stake in one of Chevron's portfolios of outer continental shelf oil exploration leases on Monday. The investment gives Total a working share of profits from 40 oil blocks in the Walker Ridge, Mississippi Canyon and East Breaks offshore fields that sit between 175 km and 330 km off the United States coast in the Gulf of Mexico.

Chevron stock trades higher on Oil rally

Chevron stock has gained 1.8% on Tuesday morning, while most of its peers in the Dow Jones reverse course from Monday's gains. CVX stock is up above $148.00 at the time of writing and narrowing the distance between itself and the 200-day Simple Moving Average (SMA) at $149.59.

This is the highest Chevron stock has traded since the April 4 sell-off that followed Trump's Liberation Day tariff announcement. Additionally, it puts CVX back above the $148.00 support level that fortified the range lows from early February and early March.

A break of the 200-day SMA would provide a roadmap for bulls to make a run at the $160 resistance level. If Oil prices continue to rise, then CVX could even retest the $168.00 region from late March.

CVX daily stock chart

CVX daily stock chart

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Author

Clay Webster

Clay Webster

FXStreet

Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.

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