This is the third article in a seven-part series examining the changing dynamics of the oil and energy industry: Introduction | BP | Exxon | Chevron | Shell | Total | Statoil

This week I am tackling the giant of the giants, ExxonMobil. With a market capitalization hovering around $400 billion, Exxon until recently vied with Apple for the title of largest company in the world by valuation. Its annual revenues are frequently larger than entire countries, including Serbia and Tanzania.

Oil prices may have taken their toll on that ranking since 2014, but many believe the U.S. major's financial strength will help it ride out the downturn and prove a smart investment.

Not only does Exxon's size make it stand out from the crowd, but its history of climate change denial and reluctant moves toward a new consensus has also given it a name as the "bad guy" of Big Oil. This was the subject of a painful news story last week when the Rockefeller Family Fund, the family that founded Exxon's predecessor Standard Oil, divested its stake in the company.

Exxon is no exception to the trend of slashing spending. The capital budget is being cut by 25 percent from $31 billion in 2015 to a still-impressive $23 billion in 2016. However, the major's financial strength is the envy of the sector.

Exxon is clinging on by its fingertips to its rare AAA credit rating — in place for 90 years. The company's prudent financial management has resulted in a low debt-to-equity ratio and strong balance sheet, affording it more flexibility than its competitors.

However, as we saw with BP, the elephant in the room is Exxon's dividend. The dividend is guarded jealously by shareholders, who have enjoyed payouts for an impressive 33 consecutive years through the good times and the bad times. Exxon's dividend is perhaps the safest in the industry, but even it will be under pressure if we do not see changes in market fundamentals over the coming months. The unthinkable could happen.

Exxon is the most likely company to attempt to survive through scaling up, in the spirit of the early 2000s when the present-day majors were born. The company's unusually liquid position means it may be in a position to take advantage of undervalued companies during a trough in the commodities cycle, possibly to pursue a large M&A transaction.

Reports in February that Exxon had raised $12 billion in the biggest bond sale on record sparked rumors that the company was looking to "go shopping" and absorb a smaller rival. Analysts were quick to notice Exxon does not need those funds to cover other expenses.

Several targets have been suggested, among them U.S. shale players Marathon Oil (market capitalization of $8.8 billion), Whiting Petroleum ($1.6 billion) or Continental Resources ($11 billion), all of which could just about be covered by Exxon's recent debt issuance. The company already has extensive technical experience in the Bakken formation and so would not be starting from scratch.

Otherwise, Exxon may choose to target individual assets being offloaded by struggling sellers. The focus has been on smaller shale assets rather than big-ticket megaprojects, but internationally some of Italian Eni's assets in East Africa have seen interest from Exxon.

The board will also be keeping a close watch on the unfolding of the sanctions on Iran, with an eye for re-entry. However, U.S. companies may miss out on the most attractive assets to European companies until multilateral U.S. sanctions are fully lifted following the successful nuclear negotiations.

Investors are showing an excitement about Exxon stock that we do not see buzzing around the other oil majors. This is because while Exxon's bottom line has taken a hit, it is a smaller one than competitors. It is also significantly diversified into downstream and chemicals, which show better margins than upstream.

And then, of course, there is that sought-after dividend. We should be listening out for news of acquisitions following the $12 billion deposited in Exxon's purse following the bond acquisition. But the company's trusted ability to navigate and ride out the commodity cycles will be put the test by today's prolonged period of depressed prices.