Shares in major oil companies have skyrocketed to unprecedented levels following the outbreak of war in the Middle East, triggering historic price increases in global oil and gas markets. The combined market value of six Western "super major" oil firms listed on stock exchanges has surged by over $130 billion in the two weeks since the initial US-Israeli attacks on Iran.
Record Valuations for Industry Giants
The energy supply shock resulting from the conflict has propelled London-listed Shell, Europe's largest oil company, to a record stock market valuation of £190 billion on the London Stock Exchange as of Friday. This marks a significant increase of approximately 12% since February 27. Similarly, US oil giants ExxonMobil and Chevron have experienced substantial gains, with their market values climbing to $630 billion and nearly $390 billion, respectively, following share price rises of more than 5% and 7% in the same period.
Impact on Other Major Players
Other prominent oil companies have also benefited from the market turmoil. British oil company BP saw its shares climb by over 12% since late February, reaching a market valuation of £82 billion. French oil company TotalEnergies recorded gains of about 10%, valuing it at €176 billion (£151 billion), while Italy's partly state-owned ENI increased by approximately 13% to €67 billion. Notably, Norway's state-owned Equinor, Europe's largest gas supplier with no Middle East production assets, experienced a more than 20% rise in its Oslo-listed shares over the fortnight, though its market value of $90 billion remains slightly below previous peaks during the gas crisis after Russia's invasion of Ukraine.
Oil Price Dynamics and Market Reactions
The international oil benchmark price reached highs of $117 per barrel earlier in the week and settled just above $103 per barrel at the close of UK trading on Friday. This sharp price increase has been sufficient to offset disruptions, such as the production shutdown at Qatar's main liquefied natural gas facility, which forced Shell to declare force majeure on deliveries from the site. Analysts predict multibillion-dollar windfalls for the industry, with consultancy Rystad Energy forecasting a $63.4 billion boost for US oil companies and Goldman Sachs estimating a combined £5 billion windfall for BP and Shell.
Calls for Windfall Taxes Amid Profits
In response to the soaring profits, global environmental group 350.org has urged governments to implement windfall taxes on the world's largest oil companies. Clémence Dubois, the group's global campaigns manager, emphasized that "working people shouldn't be paying the price while oil majors treat the war in the Middle East like a winning lottery ticket." She advocated for redirecting tax revenues to support households and accelerate the transition to clean energy, warning against fuel duty cuts as a form of subsidy for already profitable companies.
The ongoing conflict in the Middle East is creating what some analysts describe as the largest supply disruption in the history of oil markets, driving record valuations and sparking debates over corporate responsibility and energy policy.
