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

The ongoing US-Iran conflict has led to a significant increase in oil prices, causing major oil companies to reap large profits. Analysts expect American oil and gas giants Exxon Mobil and Chevron to report high earnings due to the elevated prices of Brent crude, which soared from $70 to above $100 a barrel between March and May. The Strait of Hormuz, a vital waterway for oil shipments, has been largely blocked since the conflict began, resulting in global supply constraints and higher fuel costs for consumers.

Refineries are also benefiting from the situation, as they sell their goods at higher prices due to historically high 'crack spreads.' This is a term used to describe the profits refineries make based on oil and product prices. Tom Seng, an assistant professor of energy finance at Texas Christian University, noted that refineries can earn $50-$60 per barrel, compared to the average range of $20-$25.

However, not all oil companies are benefiting equally from the current market conditions. Companies in the Middle East are struggling to get their liquefied natural gas due to the conflict and sanctions. This has led to varying fortunes for different companies, with some thriving while others struggle.