US-Iran Conflict Drives Oil Prices Higher, Boosting Major Energy Companies' Profits

The ongoing conflict between the US and Iran has led to increased energy prices and massive profits for major oil companies. Exxon Mobil reported a doubling of its second-quarter profits to $14.53 billion, while Chevron nearly quadrupled its profits to $12.07 billion.

The Strait of Hormuz, a narrow waterway that accounts for a fifth of the world's oil and natural gas shipments, was halted by the conflict. As a result, Brent crude prices soared from about $70 to above $100 a barrel in March, April, and May, reaching as high as $126.

Refineries are benefiting from historically high 'crack spreads,' which describe the profits refineries make based on oil and product prices. This has led to huge profits for companies like Exxon and Chevron, but not all oil and gas companies benefit equally in this environment.