Oil Surges After Iran Strikes Shut Hormuz Traffic — Exxon Mobil (XOM) and Chevron (CVX) Rise

TLDR

• US and Israeli strikes on Iran triggered an effective closure of the Strait of Hormuz, halting tanker traffic through a route that handles 20% of global oil supply.
• Brent crude surged as much as 13%, hitting its highest level since January 2025, while diesel futures jumped up to 20%.
• Saudi Aramco halted operations at its Ras Tanura refinery after a drone strike; explosions were reported in Dubai, Abu Dhabi, and Kuwait City.
• Analysts at Wood Mackenzie warn oil could exceed $100 a barrel if the waterway stays blocked; JPMorgan says a 25-day closure could force Middle East producers to suspend output.
• Energy stocks Exxon Mobil and Chevron rose as investors positioned for higher crude prices, with both holding Strong Buy ratings from Wall Street analysts.

Oil prices jumped sharply on Monday after US and Israeli forces struck Iran over the weekend, triggering a near-shutdown of tanker traffic through the Strait of Hormuz.

Global benchmark Brent crude surged as much as 13%, reaching its highest point since January 2025. It was trading around $80 a barrel as of Monday morning. US crude futures rose more than 7%, climbing to around $72 a barrel.

The Strait of Hormuz, a narrow waterway off Iran’s coast, handles roughly one-fifth of the world’s oil supply. Shipowners and traders imposed a self-imposed pause on traffic as the conflict widened.

Iran’s Supreme Leader, Ayatollah Ali Khamenei, was killed during the exchanges. Tehran responded with strikes against Israel and US bases across Saudi Arabia, Qatar, the UAE, Kuwait, and Bahrain.

Saudi Aramco halted operations at its Ras Tanura refinery after a drone strike in the area. Explosions were also reported in Dubai and Abu Dhabi. Smoke was seen rising from the US embassy in Kuwait City, according to Agence France-Presse.

Iran said it downed a US fighter jet that crashed in Kuwait. President Trump said US forces sank nine Iranian naval ships and that operations would continue until all objectives were met.

Diesel futures surged as much as 20%, alongside crude oil. OPEC+ agreed at a pre-arranged weekend meeting to raise production quotas by 206,000 barrels a day in April.

What Analysts Are Saying

Citigroup analysts projected Brent trading in the $80-to-$90 range over the coming week. Morgan Stanley raised its second-quarter Brent forecast to $80 a barrel, up from $62.50.

Wood Mackenzie said oil could exceed $100 a barrel if Hormuz remains blocked. JPMorgan analysts warned that a 25-day closure could force major producers to suspend output entirely as storage fills up.

Iran pumps about 3.3 million barrels a day, around 3% of global supply. Its location next to the strait gives it outsized influence over global energy flows.

Trump told the New York Times the US plans to sustain its assault on Iran for “four to five weeks.” He also said he was open to lifting sanctions if new Iranian leadership proved cooperative.

Energy Stocks React

Shares of Exxon Mobil rose 2.67% and Chevron gained 1.41% as investors moved toward energy stocks. Both companies stand to benefit from higher crude prices, which widen profit margins for oil producers.

Exxon Mobil Corporation, XOM

Exxon reported full-year 2025 earnings of $28.8 billion, down from $33.7 billion in 2024. Chevron posted fourth-quarter 2025 adjusted earnings of $1.52 per share, with quarterly revenue near $46.9 billion.

Wall Street holds a Strong Buy consensus on both stocks. Exxon’s average price target is $144.63, while Chevron’s stands at $187.26, with a dividend yield of 4.5%.

Trump told the New York Times that combat operations against Iran would continue, with no immediate sign of de-escalation as of Monday morning.

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