Chevron and Exxon posted surging second-quarter profits as the Iran war pushed up oil prices, with combined net income reaching $26.5 billion. President Trump is simultaneously pressuring the industry over gasoline prices, having ordered a Department of Justice probe into potential price gouging.
Chevron and Exxon reported second-quarter profits that surged on rising crude oil prices tied to the Iran war. Combined, the two companies posted $26.5 billion in net income for the quarter, even as President Trump ramps up pressure on the industry over gasoline prices.
Chevron's income jumps nearly 400%
Its net income soared to $12 billion, a nearly 400% increase from $2.5 billion a year earlier. Its adjusted earnings came in at $6.06 per share, 50 cents above Wall Street's estimate. Exxon's profit, meanwhile, rose to $14.5 billion, doubling from about $7.1 billion in the same quarter last year. Its adjusted earnings of $3.52 per share missed estimates by 8 cents.
Investors reacted unevenly: Chevron shares were about 1% higher in premarket trading, while Exxon shares were down nearly 2%. Behind the earnings sat a move in the underlying commodity — US crude oil futures averaged a closing price of $92.45 per barrel from April through June, a 27% increase over the previous quarter.
Production climbed alongside prices. Chevron's US output hit an all-time high of around 2 million barrels a day as exports rose amid the Middle East supply disruption. Worldwide production reached 4 million barrels a day, a 20% increase over 3.4 million bpd a year earlier. According to CNBC: "We're kind of firing on all cylinders, which is good, because the world needs it", Chevron CEO Mike Wirth told the network.
Trump turns up pressure on gas prices
The windfall puts the companies on a collision course with the president, who has accused the industry of price gouging. Last month, Trump ordered a Department of Justice probe into energy companies over price gouging. He has set a target of $2.25 a gallon for gasoline, a level last reached in 2020 during the pandemic demand collapse. US gasoline prices currently average $4.11 per gallon, according to AAA.
Exxon's chief financial officer told the Financial Times that further increases in petroleum product prices are possible if the Strait of Hormuz — the chokepoint through which a fifth of global oil supply typically flows — is closed to tanker traffic. Refining capacity, not crude itself, is where the real strain shows, he said, as Ukrainian attacks on Russian refineries and China's halt on product exports add further constraints on global supply.
Sources: CNBC, Financial Times
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