Chevron outperformed Exxon in market value on Wednesday, becoming the largest oil company in the U.S. This is the first time Chevron has been in the top spot since at least 1980, according to data from Bloomberg.

The milestone is more about Exxon's decline than about Chevron's rise because the oil industry as a whole has been battered by the fall in crude prices triggered by the coronavirus pandemic.

Exxon's market value has dropped by more than 50 percent since the beginning of the year, to $140.7 billion. Chevron's value dropped to about 40 percent to $140.8 billion. The S&P 500 is more than 5% larger in the same period.

Exxon's stock was subjected to pressure from a number of events, including its fall from the Dow Jones Industrial Average in August and two consecutive quarters of losses. The company also has a high dividend yield, indicating that it may be forced to cut its prized payout in the coming weeks.

"Dividend sustainability remains a top priority for XOM," Goldman Sachs analysts said late-September, "with mixed views on how the company will ultimately move forward on the dividend."

While Chevron has faced similar challenges — an $8.3 billion loss reported in the second quarter — some analysts consider it a more resilient pick when oil is cheap. Chevron also has a stronger balance sheet than Exxon, according to a note published by Goldman Sachs in early September.

Chevron's stock was also boosted when the company announced in July that it would acquire the Noble Energy gas producer.

This year, the energy sector has underperformed every other industry in the S&P 500, driven by a fall in oil prices in March. The price of Brent crude, the international benchmark, has dropped by about 37% since the beginning of the year.

Exxon was once the largest company in the nation
Seven years ago, Exxon was the largest company in the US in terms of market value. It was almost half a trillion dollars by mid-2014 when oil traded more than $100 a barrel.

Exxon's financial losses are linked to the recent collapse of oil markets. Plus, the interest of investors in large fossil fuel companies is declining. In the August report, Bank of America stated that there is a "cocktail of disincentives" to own oil stocks, including a focus on sustainability among investors.

Relative to its rivals, Exxon also owed a large amount of debt to increase oil production, and to cover its dividend, the Wall Street Journal reported. The company spent more than $260 billion on capital expenditure between 2009 and 2019, The Journal said, adding $45 billion in debt.

Investors are rewarding companies that are disciplined by their capital, Bank of America said. Goldman Sachs, who favors Chevron (CVX), said at the end of September that he had "expected that CVX would apply strong capital discipline."

After Exxon had been cut off from Dow's 30-year-old company, Chevron was the only remaining oil stock.