# Big Oil’s Big Wartime Profits

An episode of [Big Take](https://invisiblenetwork.ai/podcast/1578096201), 3 Aug 2026, 17 min.

Audio: https://podtrac.com/pts/redirect.mp3/tracking.swap.fm/track/UVBrz8bN8aM2Xe47PEPu/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/825d4e29-b616-46f4-afd7-ae2b0013005c/ebc26041-5790-4a3f-af5c-b49b0161c7ad/audio.mp3?utm_source=Podcast&in_playlist=8b1dd624-a026-43e9-8b57-ae2b00130066

US crude prices fell below $80 for much of the day Monday as oil traders factored in a potential deal to reopen the Strait of Hormuz. But even as reports of imminent peace deals or attacks jolt oil markets, fuel prices at US gas stations have remained high. Late last week, US oil companies Exxon and Chevron reported their biggest profits in years. On today’s Big Take podcast, oil reporter Mitchell Ferman joins host Sarah Holder to explain why oil companies are built for global conflict. Read more: • Big Oil Set to Reap Profit Bonanza From Soaring Fuel Prices • Exxon, Chevron Steer Windfall Profits Into Paying Down Debt We have a special Bloomberg subscription offer for podcast listeners at Bloomberg.com/podcastoffer. Hosted by Sarah Holder; Produced by Laura Newcombe; Reported by Mitchell Ferman; Edited by Jeffrey Grocott. Fact-checking by Rachael Lewis-Krisky and Victor Swezey; Engineering by Emma Munger. Senior Producer: Naomi Shavin; Deputy Executive Producer: Julia Weaver. Executive Producer: Nicole Beemsterboer. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
[0:09] Speaker 2: Brank Crude goes higher, up by six point six percent.
[0:11] Speaker 2: As we don't get any clarification on the strait of hormies.
[0:15] Speaker 1: They drop an oil apparently a couple of days of
[0:17] Speaker 1: a pause between the US and Iran in terms of strikes.
[0:20] Speaker 1: Oil prices have swung wildly since the start of the
[0:23] Speaker 1: US and Israel's war in Iran, which has caused major
[0:26] Speaker 1: disruptions to key shipping routes in the Middle East and
[0:30] Speaker 1: put pressure on global energy supplies. After surging in July,
[0:35] Speaker 1: prices of Brent crude and West Texas intermediate both fell
[0:38] Speaker 1: over the weekend. In response to President Donald Trump's announcement
[0:42] Speaker 1: that diplomatic talks with Iran would start up again this week.
[0:45] Speaker 2: Oil prices stumble as much as seven percent on optimism
[0:49] Speaker 2: the United States and Iran will reach a deal to
[0:52] Speaker 2: reopen the strait of her moves.
[0:55] Speaker 1: By this afternoon, prices we're bouncing back yet again after
[1:00] Speaker 1: John said talks weren't on and Trump attacked Iranian leadership
[1:03] Speaker 1: on truth social For oil markets, it's been a volatile time,
[1:09] Speaker 1: but for the world's biggest oil companies, this energy crisis
[1:14] Speaker 1: has created an opportunity.
[1:16] Speaker 2: It's big oils turn now for earnings. Most reported massive
[1:20] Speaker 2: increases in second quarter profit as the war drags on.
[1:23] Speaker 1: Exon and Chevron, the two biggest US oil companies, released
[1:27] Speaker 1: second quarter earnings on Friday, reporting their highest profits in years.
[1:32] Speaker 2: The last time they saw profits this big was right
[1:35] Speaker 2: after Russia invaded Ukraine.
[1:37] Speaker 1: That's Mitchell Furman, who covers oil markets for Bloomberg. European
[1:41] Speaker 1: oil majors like Total Energies and Shell had stand out
[1:45] Speaker 1: quarters too. And all these gains are coming as US
[1:49] Speaker 1: consumers face month after month of high gas prices.
[1:53] Speaker 2: They're quick to increase the prices and slow to lower
[1:57] Speaker 2: the prices.
[1:58] Speaker 1: They're gouging the American I.
[2:01] Speaker 2: Am getting shafted at the poem. That's how I feel.
[2:04] Speaker 1: That backlash is also coming from the President, who asked
[2:07] Speaker 1: the Justice Department in June to look into the gas
[2:10] Speaker 1: prices these companies have been charging and said on Monday
[2:13] Speaker 1: afternoon he was not happy about those big profits.
[2:17] Speaker 2: To give some of that back.
[2:18] Speaker 1: To the public, and they better cut the retail price.
[2:22] Speaker 2: Ultimately, they are responsible for the world's oil and gas,
[2:26] Speaker 2: and the world consumes one hundred million pails of it
[2:30] Speaker 2: a day, and so you know that because of how
[2:34] Speaker 2: oil and gas feeds through to the economy, that consumers care,
[2:39] Speaker 2: politicians care, and so if those prices are out of step,
[2:43] Speaker 2: then there's going to be strong reaction.
[2:49] Speaker 1: I'm Sarah Holder, and this is the big take from
[2:51] Speaker 1: Bloomberg News today on the show, how oil companies are
[2:55] Speaker 1: profiting off the war in Iran and why gas prices
[2:58] Speaker 1: can stay high even when oil prices fall. So, Mitchell,
[3:08] Speaker 1: I want to start by getting an update on where
[3:10] Speaker 1: oil markets stand right now Monday morning, New York Time,
[3:13] Speaker 1: after the news yesterday that Trump was calling off a
[3:16] Speaker 1: strike in Iran and planning on renewing talks this week.
[3:19] Speaker 2: Crew prices since the start of the war have been
[3:21] Speaker 2: on a roller coaster. They went above one hundred and
[3:25] Speaker 2: twenty dollars a barrel, which is very high. But the
[3:28] Speaker 2: oil market's worst fears for decades has been that the
[3:31] Speaker 2: straight of war moves is shut. And the straight of
[3:33] Speaker 2: war moves has effectively been shut. And oil never reached
[3:37] Speaker 2: anywhere near the two hundred dollars barrel number that many feared,
[3:41] Speaker 2: and part of that is due to Trump kind of
[3:45] Speaker 2: signaling to the market that peace was near, and so
[3:48] Speaker 2: as we saw, we started the weekend with the US
[3:51] Speaker 2: saying that, you know, there might be some more fighting coming, right,
[3:55] Speaker 2: and then we ended the weekend with peace maybe advancing.
[4:00] Speaker 2: So oil then comes off when there's some sort of
[4:04] Speaker 2: possible indication that piece is near. And so oil has
[4:08] Speaker 2: been an eighty dollars barrel range today that could change
[4:14] Speaker 2: based on the direction of the talks tomorrow.
[4:17] Speaker 1: This tumult in energy markets that you're describing caused by
[4:21] Speaker 1: the Iran war has been profitable for oil companies, and
[4:25] Speaker 1: on Friday we got a sense of just how profitable
[4:28] Speaker 1: when the two biggest US oil companies, Exon and Chevron
[4:32] Speaker 1: reported second quarter earnings. What did those earnings reveal?
[4:37] Speaker 2: Yeah, those earnings revealed one big misconception that this is
[4:42] Speaker 2: simply an oil story. It's really a fuel market story.
[4:45] Speaker 2: Crude prices have certainly risen during the Iran conflict, but
[4:50] Speaker 2: they weren't the biggest driver of earnings. The biggest driver
[4:53] Speaker 2: was what happened after crude left the production sites for
[4:58] Speaker 2: these companies. Refining margins surged because gasoline, diesel, and jet
[5:04] Speaker 2: fuel markets became much tighter than crude markets. At the
[5:09] Speaker 2: same time, volatility created exceptional opportunities for commodity traders. These
[5:17] Speaker 2: large integrated oil and gas companies, particularly the Europeans, have
[5:22] Speaker 2: massive in house commodity trading arms. So the biggest winners
[5:27] Speaker 2: this quarter weren't necessarily the companies producing the most oil,
[5:31] Speaker 2: but the company's best position to profit from what happened
[5:35] Speaker 2: after the oil was produced.
[5:38] Speaker 1: The strait of Formose has been closed and opened multiple times.
[5:41] Speaker 1: Tensions between the US and Iran have flared and cooled
[5:44] Speaker 1: and flared again. Has this uncertainty been working in these
[5:48] Speaker 1: oil companies favor? How does that work?
[5:50] Speaker 2: It does work for some parts of their company. I
[5:54] Speaker 2: mentioned the Europeans being big traders. I mean people tend
[5:57] Speaker 2: to think of Examobile, Chevron, Shell, BP as companies that
[6:01] Speaker 2: just pull oil out of the ground. They're also refiners,
[6:06] Speaker 2: commodity traders, fuel marketers, chemical manufacturers, so that means they
[6:11] Speaker 2: generate earnings at multiple points along the value chain. Shall
[6:15] Speaker 2: lost a significant amount of gas production because of war
[6:20] Speaker 2: related outages and Qatar, which included a missile striking one
[6:24] Speaker 2: of its facilities. Yet Shell recorded its second best ever
[6:29] Speaker 2: quarterly profits because refining and trading more than made up
[6:33] Speaker 2: for the production losses, and.
[6:35] Speaker 1: I'm wondering where supply and demand fit into this conversation.
[6:40] Speaker 1: Is it just simply a matter of these companies are
[6:42] Speaker 1: now able to set higher prices on the oil they
[6:44] Speaker 1: are producing, and therefore they're making higher margins.
[6:48] Speaker 2: Ultimately, it's a global market and the fuel market piece
[6:52] Speaker 2: of all of this is the refining element, the fuel processing.
[6:58] Speaker 2: A lot of this fuel processing has been knocked out
[7:01] Speaker 2: due to both the Iran conflict but also Ukraine's attacks
[7:05] Speaker 2: on Russia's refineries. Russia is a huge exporter of diesel,
[7:09] Speaker 2: for example, and so refined products markets are tighter refiners,
[7:15] Speaker 2: which these large integrated companies are. They're running their refineries
[7:20] Speaker 2: all out. The other side of this refining story is
[7:24] Speaker 2: that these companies Shell Exxon VP, they're running their refineries hard.
[7:30] Speaker 2: They're running them all out to make the products that
[7:33] Speaker 2: consumers are using. That's unsustainable. These refineries are going to
[7:37] Speaker 2: have to go down for maintenance and turnarounds at some point.
[7:40] Speaker 1: So these companies are at a structural advantage here because
[7:44] Speaker 1: they have the refining capacity. Are other oil companies that
[7:48] Speaker 1: are not refining seeing these kinds of gains.
[7:51] Speaker 2: Some of the you know in the US shel patch,
[7:53] Speaker 2: for example, in West Texas and southeast New Mexico, where
[7:56] Speaker 2: a lot of these independent operators that's all they do
[8:01] Speaker 2: is just produce oil and gas. So they are seeing
[8:04] Speaker 2: the benefits of these elevated prices. However, everything is costing more.
[8:09] Speaker 2: You know, they also have to buy gas and diesel
[8:13] Speaker 2: to power some of their operations, which in turn is
[8:15] Speaker 2: more expensive. So they're seeing some benefits, but they're also
[8:19] Speaker 2: seeing higher costs.
[8:20] Speaker 1: So Mitchell, on one side of the equation are these
[8:23] Speaker 1: oil companies that are making profits they haven't seen in years.
[8:27] Speaker 1: And then on the other side of the equation are
[8:29] Speaker 1: the people who actually buy these products, including people buying
[8:31] Speaker 1: gasoline at US fuel pumps. They've been paying a lot
[8:35] Speaker 1: more for gas recently, given that, what has the public
[8:39] Speaker 1: reaction been to the news that these oil companies made
[8:44] Speaker 1: you know, fourteen billion dollars, twelve billion dollars and more
[8:48] Speaker 1: in the second quarter.
[8:50] Speaker 2: Ultimately, drivers don't want high prices to fill up their cars,
[8:54] Speaker 2: and so, of course in America, the gasoline price is
[8:58] Speaker 2: the most visible price across the Everybody drives past these
[9:01] Speaker 2: giant illuminated signs every day, so naturally the public is
[9:06] Speaker 2: not pleased with higher gas prices. But as we've laid
[9:11] Speaker 2: out a bit, there's a whole industrial process between crude
[9:15] Speaker 2: oil and the pump. Somebody has to refine it, transport it,
[9:19] Speaker 2: blend it, distribute it. And during the Iran conflict, those
[9:24] Speaker 2: parts of the system have become much tighter than crude itself.
[9:28] Speaker 1: And what if anything, have Exon and Chevron said to
[9:33] Speaker 1: criticisms that they're making these you know, years long, record
[9:38] Speaker 1: setting levels of profit in an energy crisis, in a
[9:42] Speaker 1: time of war.
[9:43] Speaker 2: Yeah, Exon talked about how they're standing with these countries
[9:49] Speaker 2: and that they have the capacity and the operations to
[9:55] Speaker 2: be able to make the products and the fuels that
[10:00] Speaker 2: the world uses at a time when those products are tight.
[10:05] Speaker 2: And so that's kind of their argument that they are producing,
[10:10] Speaker 2: they're refining, they're transporting fuels around the world at a
[10:15] Speaker 2: time when there's less of that ability to do so.
[10:19] Speaker 2: Chevron's also talked about how they call them middle distillates,
[10:24] Speaker 2: which is like jet fuel, diesel. Those products are tight,
[10:28] Speaker 2: and that's when they see a need to step up
[10:32] Speaker 2: and get those products to the world. And a big
[10:35] Speaker 2: thing that these companies lean into is that they are
[10:38] Speaker 2: global and they have portfolio of assets all over the place.
[10:43] Speaker 2: So while a company like Exxon, for example, has a
[10:47] Speaker 2: sizeable presence in the Persian Gulf and they've had hundreds
[10:50] Speaker 2: of thousands of barrels of oil equivalent knocked offline as
[10:54] Speaker 2: a result of this war, they can lean into the
[10:58] Speaker 2: nature of their global portfolio, and they have assets in
[11:02] Speaker 2: the US and South America and Africa. They're able to
[11:07] Speaker 2: kind of optimize in a way to try to make
[11:09] Speaker 2: up for those losses.
[11:14] Speaker 1: After the break, oil reporter Mitchell Furman on President Trump's
[11:18] Speaker 1: problem with big oil and why the frustration goes both
[11:22] Speaker 1: weights and the oil companies are possibly gouging. I hope
[11:39] Speaker 1: they're not, otherwise they're going to be in big trouble.
[11:42] Speaker 2: Mitchell.
[11:42] Speaker 1: I want to talk about the political element here a
[11:44] Speaker 1: little bit more because in the US midterm elections are
[11:47] Speaker 1: just a few months away, and the latest Quinnipiac poll
[11:50] Speaker 1: which came out last week showed that sixty six percent
[11:54] Speaker 1: of US voters disapprove of how Trump's handling the situation
[11:57] Speaker 1: in Iran, and seventy three percent of said he bears
[12:01] Speaker 1: some or a lot of the blame for the recent
[12:04] Speaker 1: rise in gas prices. But as you alluded to, Trump himself,
[12:09] Speaker 1: as many presidents have done in the past, has instead
[12:12] Speaker 1: singled out these big oil companies. So it's Exon Mobile,
[12:17] Speaker 1: it's HIV Run, it's Shell, it's.
[12:22] Speaker 2: Pp it's a lot of them.
[12:24] Speaker 1: About a week after Iran and the US signed a
[12:27] Speaker 1: memorandum of understanding that started the flow of oil through
[12:29] Speaker 1: the Strait of Hormoes again, Trump said gas prices should
[12:32] Speaker 1: be back down to two dollars and twenty five cents,
[12:35] Speaker 1: and he said it was the oil company's fault that
[12:37] Speaker 1: gas prices aren't lower. What exactly was his argument there.
[12:42] Speaker 2: Ultimately, these companies have their names on the gas stations,
[12:45] Speaker 2: right and people see if they're going to fill up
[12:47] Speaker 2: their vehicle at a Chevron or Exonmobile station, those two
[12:51] Speaker 2: things without understanding the further system can easily be correlated.
[12:58] Speaker 2: So it can be pulitedly advantageous for Trump to single
[13:02] Speaker 2: them out. Oil companies are profiting from this situation. That
[13:07] Speaker 2: is clear. Whether there is a legal or antitrust case.
[13:12] Speaker 2: Here is a higher bar that the US Department of
[13:16] Speaker 2: Justice is looking into and others, and we'll see the findings.
[13:20] Speaker 1: I want to talk more about how the oil companies
[13:23] Speaker 1: respond to this criticism, Because a spokesperson from the American
[13:26] Speaker 1: Petroleum Institute recently told Bloomberg, quote, gasoline prices don't move
[13:31] Speaker 1: in lockstep with crude oil, especially during a major global
[13:34] Speaker 1: disruption that is still affecting supply, refining, and inventories. Can
[13:40] Speaker 1: you dig into this idea a little bit more. Why
[13:42] Speaker 1: is it that crude oil prices can come down as
[13:45] Speaker 1: they did over the weekend and gas prices don't come
[13:49] Speaker 1: down for much longer.
[13:52] Speaker 2: Yeah, there's enough oil for the world right now, but
[13:56] Speaker 2: the oil needs to be processed in order to make
[13:59] Speaker 2: those products, needs to be blended and transported in order
[14:03] Speaker 2: to make that happen. And because the world's refining capacity
[14:06] Speaker 2: has been dwindled due to both the Iron conflict and
[14:12] Speaker 2: the Russian War, that these products are more expensive. Crude
[14:17] Speaker 2: purchased now, the price will be felt later, just like
[14:21] Speaker 2: the prices we're seeing now are kind of a reflection
[14:25] Speaker 2: of crew purchase before. Now.
[14:27] Speaker 1: As you mentioned, Mitchell, one of the reactions that Trump
[14:30] Speaker 1: has had as he's ordered this Department of Justice investigation
[14:34] Speaker 1: into these oil companies, What exactly has he called for
[14:38] Speaker 1: and what could the outcome of an investigation like this.
[14:42] Speaker 2: Be Yeah, he wants the Justice Department to look into
[14:45] Speaker 2: market manipulation and whether these companies are artificially impacting prices.
[14:50] Speaker 2: We've seen these sorts of investigations in the past, and
[14:54] Speaker 2: ultimately they don't result in major penalties or major findings
[15:02] Speaker 2: that lead to any fault in a major way. These
[15:06] Speaker 2: companies have been big donors to Trump. They to some respect,
[15:12] Speaker 2: drove his election victory in twenty twenty four. But we've
[15:16] Speaker 2: also seen Trump cheering lower oil prices, and oil companies
[15:22] Speaker 2: don't love lower prices, so some people in the usl patch,
[15:27] Speaker 2: for example, were a bit confused at that. Oil companies
[15:32] Speaker 2: at the same time don't love super high prices either.
[15:36] Speaker 2: There's a sweet spot. It's usually probably in the upper
[15:39] Speaker 2: seventy dollars per barrel range. Ultimately, they like stability, and
[15:44] Speaker 2: the thing about the Trump administration is that there's very
[15:48] Speaker 2: little stability in the oil market. We've been hearing oil
[15:52] Speaker 2: companies talk for months about how their traders have been
[15:58] Speaker 2: capitalizing on this market volatility. But oil traders typically think
[16:03] Speaker 2: in fundamentals, and they're analyzing every piece of the supply
[16:07] Speaker 2: and demand picture. What they can't model is posts from
[16:12] Speaker 2: Trump on social media that indicate peace is near or not,
[16:18] Speaker 2: or a bombing campaign in Iran is starting or being
[16:23] Speaker 2: called off, and all of those things impact the price
[16:27] Speaker 2: of oil.
[16:35] Speaker 1: This is the Big Take from Bloomberg News. I'm Sarah Holder.
[16:39] Speaker 1: To get more from The Big Take and unlimited access
[16:41] Speaker 1: to all of Bloomberg dot com, subscribe today at Bloomberg
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[16:55] Speaker 1: Thanks for listening. We'll be back tomorrow.

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