FT: Oil market volatility fuels earnings boom for US producers

Major U.S. oil companies are set to report a sharp surge in profits driven by elevated fuel prices linked to the U.S.-Iran conflict, potentially putting them at odds with President Donald Trump, who has accused the industry of price gouging.

ExxonMobil and Chevron are expected to post second-quarter net income of about $15 billion and $9.7 billion, respectively, more than triple the previous quarter, as crude, diesel and jet fuel prices remain high. Refiners, including Marathon and Valero, are also forecast to report strong earnings, according to FactSet estimates, cited by the Financial Times.

The profit surge comes as U.S. fuel prices have risen significantly, with petrol averaging $3.8 per gallon, up nearly a quarter year-on-year, and diesel at $4.8, up 30%, according to AAA.

Trump has already ordered a Department of Justice investigation into potential price gouging. “Gasoline Retailers must get ​their Prices down, IMMEDIATELY,” he wrote on Truth Social. “If Retailers don’t do this, big problems lie ​ahead!”

Analysts say the earnings boom could intensify political pressure. “Investors will see returns, governments will see red,” said Kevin Book of ClearView Energy Partners, adding that while the administration seeks lower fuel prices ahead of elections, “the industry did not cause prices to rise, the war did.”

The conflict has disrupted global supply after Iran curtailed flows through the Strait of Hormuz, a key route for roughly 20% of global oil demand, driving prices higher. U.S. producers have capitalised by increasing exports, while shale companies such as ConocoPhillips and Occidental Petroleum are also expected to benefit, though many have resisted calls for aggressive new drilling.

Fuel inflation has weighed on consumers and the broader economy, pushing up transport and goods prices. An FT poll found 58% of voters believe the war has not been worth the cost.

Chevron CFO Eimear Bonner acknowledged public concerns, saying: “It’s going to take time though. There is a lag between, you know, oil prices and reductions in oil prices and when that shows up at the pump.”

Market volatility persists. Prices recently climbed back toward $80 per barrel after renewed U.S. strikes on Iran ended a brief easing tied to ceasefire hopes. Additional pressure comes from Russia’s diesel export ban following refinery disruptions, tightening global supply.

“There is this huge disparity between refined product prices and crude prices,” said Carl Larry of Enverus. “There’s going to be a sustained level of higher prices for products.”

Experts warn that uncertainty around key supply routes will continue to support elevated fuel prices in the near term.

By Tamilla Hasanova