Iran War Disruptions Fuel Prolonged High Prices, ExxonMobil and Chevron Warn

Top US oil producers ExxonMobil and Chevron have warned that global supplies of diesel and other refined products will likely remain tight due to ongoing energy disruptions caused by the Iran war. This is expected to lead to persistently high prices in the second half of the year, including for gasoline which has already crossed $4 a gallon.

Chevron CEO Mike Wirth said that demand for distillates like diesel and heating oil is unlikely to decline over the long term, contributing to upward pressure on product pricing. ExxonMobil's Darren Woods added that shipping disruptions in the Strait of Hormuz are critical to supplying more crude to the market.

Both companies reported large jumps in second-quarter refining profits as declining fuel stockpiles combined with curtailed exports from China and refinery outages in Russia led to higher margins. However, ExxonMobil narrowly missed consensus estimates for second-quarter earnings, while Chevron surpassed expectations.