Oil Giants Reap Massive Profits as Iran Conflict Drives Up Energy Prices

Major oil companies have reaped massive profits as the ongoing conflict between the US and Iran drives up energy prices. The fighting has halted most shipping through the Strait of Hormuz, a narrow waterway that previously served as a delivery route for a fifth of the world's oil and natural gas.

As a result, Brent crude, the international standard, soared from about $70 to above $100 a barrel for much of March, April, and May. At one point, it reached $126. The surge in prices has led to huge profits for some of the biggest publicly traded oil companies.

Exxon Mobil reported doubling its second-quarter profits to $14.53 billion, up 105% from the same time a year ago. Chevron nearly quadrupled its profits to $12.07 billion, up 385% from the same quarter last year.

Refineries are also enjoying historically high 'crack spreads,' which is a term to describe the profits refineries expect to make based on the prices of oil and products such as gasoline and jet fuel. This has resulted in huge profits for refineries that have ample oil to work with, including those in the US.

However, not all oil and gas companies benefit equally. Companies in the Middle East that are struggling to get their liquefied natural gas out of the Persian Gulf or have damaged oil fields or processing facilities have seen their revenues decline significantly.