Exxon CEO predicts 'significantly higher prices' due to Russia oil disruption.

• On Thursday, U.S. oil reached its highest level since 2008, and Exxon CEO Darren Woods predicted that prices could continue to rise.
• Significantly higher prices will result if there is a supply disruption with respect to Russian crude and the market is unable to make up for it, as stated by him on CNBC Thursday.
• The highest level since September 2008 was reached by West Texas Intermediate crude futures, which is the U.S. oil benchmark, at $116.57 per barrel.

On Thursday, the stock price surged to its highest level since 2008, and CEO Darren Woods stated that it could continue to rise even further.

The market will struggle to recover from a significant supply disruption of Russian crude, resulting in higher prices, according to the expert's opinion.

As Russia invaded Ukraine, causing supply fears in an already tight market, oil prices surged above $100 per barrel last week. The fighting has continued, resulting in further price increases.

On Thursday, West Texas Intermediate crude futures, the U.S. oil benchmark, reached a high of $116.57 per barrel, while the international benchmark rose to $119.84, a price not seen since May 2012.

The financial sanctions imposed by the U.S. and its allies have not directly targeted Russia's energy sector, but the consequences are being felt. International buyers are avoiding Russian oil to avoid violating the sanctions.

Additionally, companies, including Exxon, are pulling Russian operations.

BP and Shell have divested from their assets in Russia, prompting the oil giant to halt operations and make no further investments in the country.

Woods stated that our business has a substantial relationship with the government, particularly the host governments in which we operate. He expressed his dissatisfaction with the Russian government's decisions regarding its incursion in Ukraine, stating that they were inconsistent with our business practices and philosophies.

Russia's invasion was a "tipping point" for working with the country, but there is a possibility of re-entering it in the future, he said.

Things would have to change significantly, frankly," he said, before adding that "we'll keep an open mind.

Since Russia's invasion, oil prices have been at multiyear highs. However, demand has bounced back since the pandemic, and producers have kept supply in check. On Wednesday, OPEC and its allies, including Russia, announced that they would keep output steady. They also stated that they would raise production by 400,000 barrels per day in April, sticking to their previously agreed schedule.

While in the past, an increase in prices above $100 would have resulted in an increase in drilling, this has not occurred this time around as shareholders are demanding stricter capital discipline from energy companies emerging from the pandemic, with a focus on capital return in the form of dividends and buybacks.

Exxon is "increasing production" and "expanding operations" in the Permian Basin, as Woods stated.

The market signals are working, which should ultimately result in increased production across the industry.

The tight supply-demand balance is causing the observed price response, and as marginal sources of supply enter the marketplace, the price will continue to draw resources, according to Woods.