John McCain: Tillerson-Putin Relationship A ‘Matter Of Concern’

Yesterday, Arizona Senator John McCain expressed concern with the choice of President-elect Donald Trump for his Secretary of State, Exxon Chairman and CEO Rex Tillerson, as reported by the Hill.

Rex Tillerson has been the leader of the Exxon Mobil Corporation (NYSE: XOM) since 2006, as previously reported by the Inquisitr.

“I don’t know what Mr. Tillerson’s relationship with Vladimir Putin was, but I’ll tell you it is a matter of concern to me,” McCain was quoted by the Hill.

In 2012, Rex Tillerson was awarded with the Order of Friendship from the Russian government, said to be among the “highest honers” the Kremlin awards to citizens of other nations. The previous year, a Tillerson-Putin meeting of the minds was said to be responsible for an energy deal with the Russian Rosneft Oil Company (LIOB: ROSN) that was worth $500 billion.

The deal was later blocked by President Barack Obama and the European Union when they imposed sanctions on Russia as a response to its annexation of Crimea, as reported by Reuters. More recently, Glencore Plc (LSE: GLEN) and the Qatar sovereign wealth fund have made a $3 billion equity investment in the Russian oil company, reported to be the first major capital infusion since sanctions were imposed in 2014, as reported by Bloomberg.

Arizona Senator John McCain at the Hudson Institute in July 2015. [Image by Alex Wong/Getty Images]

Before being officially appointed as U.S. Secretary of State, Rex Tillerson must undergo a confirmation process in the U.S. Senate. If only three Republican senators side with a united Democratic coalition intent on blocking Tillerson, the Senate could conceivably stop his appointment.

Senator McCain called Russian President Vladimir Putin a “thug, bully, and a murderer,” but expressed a desire to give President-elect Trump “the benefit of the doubt.” McCain is said to be the first member of the GOP to raise concerns with respect to Trump’s secretary of state choice.

Senator McCain stated that he would “have to examine” the potential nomination of Tillerson.

Over the past 12 moths, Exxon stock has outperformed the general market, as measured by the Dow Jones Industrial Average (^DJI), returning close to 20 percent, compared with a return of 14.43 percent for the Dow.

The Wall Street analyst consensus for full-year 2016 Exxon revenues is $233.40 billion, down 13.20 percent year over year. In 2017, the analysts sees Exxon booking revenues of $314.49 billion, up 34.70 from forecast 2016 levels.

The analyst consensus for XOM stock earnings per share in 2016 is $2.21, down 42.60 percent on a year over year basis. In 2017, XOM EPS is expected to grow once again, by 107.00 percent, to $4.20.

The full-year 2016 and 2017 analyst EPS consensuses has been reduced over the past 90 days, by 5.15 percent and 4.01 percent, respectively.

Exxon carries a market capitalization of $369.06 billion based on Friday’s closing XOM stock price, holds $5.09 billion in cash, and $46.16 billion in debt, giving the oil conglomerate a debt-to-equity ratio of 26.08 percent.

In 2009, Exxon Mobil bought the outstanding shares of XTO Energy, taking over the company in a deal reported to have been valued at $31 billion. The Wall Street Journal noted at the time that “the XTO deal could come to define Exxon’s chief executive Rex Tillerson’s legacy.”

Previous to the XTO acquisition, Exxon’s biggest purchase had been the $82 billion deal to buy Mobil, in 1999.

President-elect Donald J. Trump’s choice for Secretary of State: Exxon Chairman and CEO Rex Tillerson. [Image by Mark Wilson/Getty Images]

It has been noted that Exxon has “vowed” to continue in its agreement with Rosneft once U.S. sanctions are lifted, a process the Hill notes that Tillerson would be “heavily involved in” if appointed as secretary of state: a seeming point of contention for those who may disapprove of President-elect Trump’s choice.

Rex Tillerson has worked with Exxon for 40 years, beginning as an engineer with the company. He holds a degree in engineering from the University of Texas.

[Featured Image by Adam Berry/Getty Images]

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