Iran War Drives Exxon and Chevron's Record-Breaking Earnings

The Iran war has led to a surge in oil prices, benefiting Exxon and Chevron's quarterly earnings. The two companies' profits more than doubled year-over-year, reaching $26.6 billion in Q2. Their integrated business models capture profits from production through refining and marketing.

Oil prices have spiked since the war began, with Brent crude rising above $88 a barrel and West Texas Intermediate (WTI) crude above $82 a barrel. This has resulted in higher gas prices for American drivers, with the national average at $4.06 a gallon as of this morning.

The Strait of Hormuz remains closed, with little tanker traffic moving through the waterway. A peace deal reopening the strait could send oil prices sharply lower, but investors shouldn't assume every additional $10 in crude translates directly into another $10 billion of profit.