Investing.com -- Bank of America upgraded ExxonMobil shares to Buy from Neutral, arguing that the stock’s pullback from its highs has left it trading at an attractive valuation regardless of whether a peace deal between the U.S. and Iran materializes.

The bank reiterated its $154 price target on the stock.

Exxon shares jumped to $147 in late 2025 and early 2026, even before the Iran war officially began, pricing in a long-term oil price of around $70 a barrel. After the conflict started, the stock hit an all-time high of $171 before retreating.

At Monday’s price of around $141, BofA estimates the stock is now pricing in a long-term Brent price of just $65 a barrel. Analysts led by Jean Ann Salisbury said they see "low fundamental downside from here," and described the setup as "a free call option" should the prospective peace deal fail to materialize and oil prices move back up.

BofA pointed to several factors supporting Exxon in a post-conflict environment. About 20% of the company’s production volume comes from the Middle East, with most of it currently shut in. This could add roughly $3.3 billion in annualized free cash flow at $70 Brent once it resumes.

The analysts also cited the value of Exxon’s integrated business model amid expected volatility, the potential for reopened Guyana acreage tied to Venezuela’s political trajectory, and greater negotiating leverage in Qatar and other Gulf states as countries look to expand development.

Commenting on oil price outlook, the analysts said it remains "hard to see oil price falling below $70/bbl in the medium term as 1 billion barrels+ must be replaced and more countries likely add strategic petroleum reserves (SPRs)."

They flagged that supply growth tied directly or indirectly to Iran could eventually weigh on prices later in the decade, but noted any such pressure is likely to materialize later in the decade rather than near-term.

Exxon also stands to benefit from its U.S. operations, where BofA noted the company has raised its Permian production guidance for 2030 to 2.5 million barrels of oil equivalent per day from a prior 2.3 million target, without any increase in capital spending.