Iran’s war cuts US oil output from Gulf, lifts prices

STRAIT OF HORMUZ, GULF COOPERATION COUNCIL (GCC) COUNTRIES, UAE, KUWAIT, BAHRAIN, QATAR, SAUDI ARABIA, OMAN, IRAN, 30 AUGUST 2026 —

Iran’s six-month campaign against Gulf energy infrastructure has slashed US oil and gas flows from the region while pushing Brent crude up 22 percent, creating a split between companies that profit from higher prices and those whose regional assets are under fire.

The fighting has already cut US energy firms’ share of Gulf gas supplies by about 40 percent this year and oil supplies by 30-35 percent, said Rahul Choudhary, vice president of Upstream Research at Rystad Energy.

“While higher commodity prices have helped offset the immediate financial impact, prolonged disruption is likely to delay major projects and weigh on future growth plans of US oil and gas companies with a presence in the region,” he told Al Jazeera.

Chevron, with only 5 percent of its global output tied to the Gulf, reported adjusted quarterly profit of $12 billion on July 31, its highest in six years.

ExxonMobil, far more exposed, has seen its upstream earnings drop by about $1.3 billion in the first half of 2026 compared with the same period in 2025 because of lower volumes from Qatar and the UAE, which together account for 20 percent of its global equity upstream supply, Choudhary said. Higher prices, however, have covered the shortfall.

The contrast illustrates the dual effect of the war: oil majors benefit from tighter supply and higher prices, while peers with Gulf operations face mounting geopolitical risk. US companies typically earn through stakes in production, joint ventures, refining and petrochemical projects, or by supplying equipment and expertise. ExxonMobil is a cornerstone of Qatar’s LNG expansion, holding stakes in several QatarEnergy ventures linked to the North Field, the world’s largest gas field shared with Iran.

It also has an interest in Abu Dhabi’s Upper Zakum offshore oilfield. ConocoPhillips joined Qatar’s North Field East and North Field South projects in 2022 to lift export capacity at Ras Laffan. Occidental Petroleum operates Oman’s Mukhaizna heavy oilfield and holds UAE gas and pipeline interests.

Chevron, via Saudi Arabian Chevron, runs oil assets in the Saudi-Kuwait Partitioned Zone, including the Wafra field, and is exploring routes to move Iraqi crude to Mediterranean terminals to bypass Hormuz.

Energy infrastructure has borne the brunt of 172 attacks on non-military targets across the six Gulf Cooperation Council countries since February 28, according to the Armed Conflict Location and Event Data (ACLED) monitor. Oil and gas facilities, power plants and desalination plants accounted for 48 percent of strikes. The UAE, Kuwait and Bahrain have seen the highest number of successful hits, mostly on energy sites.

Struck facilities include Kuwait’s Mina Abdullah and Mina al-Ahmadi refineries, Bahrain Petroleum Company’s refinery, ADNOC’s al-Ruwais Industrial City and Habshan gas complex, and Saudi Aramco’s Abqaiq processing complex, which handles more than seven million barrels a day.

“Oil and gas facilities, power plants and water desalination plants are likely to remain key targets for Iran because disruption to these sectors can increase economic pressure on Gulf states, while disruption to global energy supplies increases prices and pressure on the US during periods of escalation,” said Nasser Khdour, Middle East assistant research manager at ACLED.

In March, a drone attack near the Saudi Aramco-ExxonMobil SAMREF refinery in Yanbu disrupted oil loading at the Red Sea port, highlighting vulnerability of US-linked assets. Qatar’s Ras Laffan Industrial City, the world’s largest LNG export hub and host to ventures involving QatarEnergy, ExxonMobil and ConocoPhillips, came under repeated strikes in March, at one point halting production entirely.

In June, an explosion at Qatar’s Barzan gas project, where ExxonMobil has a stake, killed at least 13 people.

Choudhary estimates ExxonMobil’s share of Qatari LNG supply will fall to about four million tonnes this year from 13 million tonnes in 2025, while ConocoPhillips’ volumes have also declined. For Malaysian investors, the immediate gain is higher energy prices that support regional refiners’ margins, but the longer-term risk is delayed Gulf projects and supply chain disruptions that could hit downstream industries.

Related: Rahul Choudhary