Exxon CEO advises Trump to maintain U.S. participation in international climate change initiative.

• Exxon CEO Darren Woods stated that the U.S. should maintain its influence on global climate change policy under a second Trump administration.
• In his second term, President-elect Donald Trump is predicted to withdraw the U.S. from the Paris climate agreement, as he did in 2017.
• Exxon's investments in carbon capture technologies could be affected if federal tax incentives are weakened under Trump, as warned by Woods.

CEO Darren Woods stated on Tuesday that President-elect Donald Trump should maintain the U.S.'s participation in international efforts to tackle climate change.

Woods advised Trump to adopt a "common sense" approach at the annual U.N. Climate Change Conference and maintain U.S. influence on global policy, as he spoke from the conference in Baku, Azerbaijan, which began this week.

In 2017, Trump withdrew the U.S. from the Paris climate agreement, but is expected to do so again in his second term. On his first day in office in 2021, President Joe Biden signed an order to rejoin the agreement, a decision that Exxon supported.

In September, Trump criticized the Paris agreement as "unfair" to the U.S. and pledged to withdraw all unused funds under the Inflation Reduction Act. He also made energy policy a key issue in his campaign, advocating for unrestricted fossil fuel production.

Exxon intends to invest $20 billion in the U.S. by 2027 in carbon capture and storage technology, hydrogen fuel, and lithium mining for electric vehicle batteries.

Exxon's investments in lowering emissions technologies are contingent on federal tax credits, which were established or expanded under the IRA. Woods cautioned that if these incentives are weakened or repealed, the company's investments in these technologies may change.

"Woods stated that there must be a reward for investments to generate a return. If the incentives disappear or vanish completely, it will alter our investment plans."

Exxon's oil and gas production levels will not change in the short term, according to Wood, regardless of the outcome of the U.S. presidential election.

Woods expressed uncertainty about the translation of "drill, baby, drill" into policy during an interview on CNBC's "Squawk Box" on Nov. 1, referencing one of Trump's campaign slogans.

The CEO stated that Exxon's shale production is not limited by the Biden administration, as the company's production levels are determined by its ability to return profits to shareholders.

Since the beginning of the year, Exxon's stock has increased by over 20%.