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BACAKORAN – ExxonMobil and Chevron, two of America’s largest oil companies, reported steep profit declines in the first quarter of 2026, underscoring how the war in Iran has upended global energy markets despite soaring crude prices.
Exxon’s net income fell 45 percent to $4.2 billion, while Chevron’s dropped 36 percent to $2.2 billion.
Both companies managed to beat Wall Street’s adjusted earnings forecasts, but the headline figures revealed the toll of disrupted shipments through the Strait of Hormuz a chokepoint that handles nearly a fifth of the world’s oil supply.
Disruption at the Strait of Hormuz
The conflict, triggered by U.S. and Israeli strikes on Iran in late February, has created the largest supply disruption in modern history.
Oil prices surged more than 57 percent, yet Exxon and Chevron struggled to capitalize.
Exxon said about 15 percent of its production was disrupted, with 750,000 barrels per day at risk if Hormuz remains closed.
CEO Darren Woods described the quarter as “a mismatch of timing,” with hedging strategies and deferred shipments distorting results.
Chevron, less exposed to Middle Eastern operations, still faced volatility in futures markets.
CEO Mike Wirth emphasized that the company’s diversified portfolio cushioned the blow, but acknowledged that “market distortions” weighed heavily on reported earnings.
Market Winners and Losers
While American majors stumbled, European rivals like BP and Shell fared better.
Their trading divisions profited from extreme volatility, highlighting the structural differences between companies that rely on physical production and those with robust trading arms.
Analysts noted that Exxon’ redeployment of 13 million barrels to priority markets may pay off in later quarters, but hurt Q1 accounting.
Chevron’s lower exposure to Hormuz offered some protection, though investors remain wary of prolonged instability.
Shares of both Exxon and Chevron slipped more than 1 percent after earnings releases, reflecting investor unease.
Analysts warn that if the Strait of Hormuz remains closed, earnings could stay structurally weak despite high oil prices.
Still, many expect eventual recovery once shipments normalize. “The fundamentals are strong,” said one energy analyst, “but the war has created a timing mismatch that clouds the near-term picture.”
ExxonMobil hedging strategies aim to lock in profits once shipments arrive, but exposure to Hormuz remains a critical risk.
Chevron Diversified operations outside the Middle East provide resilience, though volatility in futures markets continues to distort results.
Global oil markets: Sustained high prices could benefit producers long-term, but the war’s uncertainty keeps investors cautious.
