Oil prices surge, refineries run at full capacity for profit! A war ignites global energy giants

By the end of February 2026, the United States and Israel launched military strikes against Iran, and Iran immediately blockaded the Strait of Hormuz. The strait handles about one-fifth of the world's oil and LNG transportation and is a critical choke point for the global energy supply.

The conflict has lasted for six months so far, and shipping in the strait has largely stalled. Previously, the Trump administration reached a brief ceasefire agreement with Iran, but the agreement collapsed in less than a month, plunging the situation into a stalemate of intermittent fighting with no signs of a thorough ceasefire, continuing to disrupt the global energy supply chain. Affected by the situation, the international benchmark Brent crude oil briefly surged to $126 per barrel, maintained high volatility for most of the second quarter, and is currently quoted at approximately $83.5 per barrel.

High Oil Prices Drive Explosive Performance for US and European Oil Giants

Geopolitical conflicts have driven up crude oil prices, allowing global top oil companies to reap huge profits.

In the second quarter, ExxonMobil's performance soared significantly, with profits doubling year-on-year to $14.53 billion. High diesel production became the core support for performance, with revenue of $116.02 billion for the period, a year-on-year increase of 42%.

Chevron's profitability performance was even more impressive; second-quarter profits nearly quadrupled year-on-year, reaching $12.07 billion, with revenue of $70.06 billion, a year-on-year increase of 56%.

Not only US oil companies but also European top energy companies benefited. Europe's six major oil giants recorded a combined profit of $22 billion in the first quarter, a year-on-year increase of over 40%, fully releasing the dividends of rising energy prices.

Refining Business Becomes the Biggest Winner: Revenue Rises Despite Volume Drops

Industry analysis points out that integrated oil companies with both crude oil extraction and refining operations are the biggest beneficiaries of this market cycle.

Although some oil companies saw a decline in crude oil processing volume and refined product sales, the significant increase in refined product prices directly drove a surge in profits. Data shows that Chevron's quarterly refining profit in 2026 soared to six times that of previous years.

Industry experts state that the core of this profit explosion stems from the global refining supply gap. With contractions in refined product exports from countries like Russia, combined with damage to refining facilities in the Middle East and insufficient crude oil supply in Asia, global supply and demand for refined products are imbalanced. Sustained shortages of aviation fuel, diesel, and gasoline support high refining profits. Meanwhile, US refineries, holding stable crude oil supplies, continue to operate at full capacity, exclusively enjoying the dividends of this market cycle. Affected by the strait blockade, US aviation fuel and diesel prices have risen by approximately 41% compared to pre-war levels.

Dividends Passed on to End Consumers: Public Bears the Cost of Rising Energy Prices

Industry scholars bluntly state that the excess profits of oil giants are ultimately paid for by ordinary consumers.

Price increases for end-use energy products such as gasoline, diesel, and aviation fuel directly drive up public travel and vehicle costs. More profoundly, energy is a basic cost for the entire industrial chain; rising energy prices are transmitted to various goods covering clothing, food, housing, and transportation, causing an increase in overall social costs and exacerbating inflationary pressure.

The market generally predicts that before the Middle East situation is thoroughly eased and the global refining gap is filled, the pattern of high profits for refined products may continue, and the pressure of energy costs on end consumers will persist.