The U.S. war on Iran had barely begun before the oil companies started to cash in.
Working people know how this goes. When crude prices jump, gas prices rise almost immediately. When crude prices fall, pump prices come down slowly, unevenly or barely at all. Economists call it “rockets and feathers.” Working people call it getting robbed.
The war on Iran is already driving prices up — and the oil companies are moving in to cash in.
In the first two days of the war, on Feb. 28 and March 1, the U.S. burned through nearly $6 billion in munitions while carrying out massive strikes on Iran, including attacks on schools, hospitals and key industries. At the same time, shipping through the Strait of Hormuz virtually stopped. Oil available for near-term delivery, around $72 a barrel on Feb. 27, surged past $110 in the days after the war began and was still around $104 on April 13. Jet fuel prices in Asia and Europe have roughly doubled from prewar levels. Refined fuel prices are rising across Africa and much of the Global South.
War does not just disrupt supply. It throws the whole system of shipping, insurance and payment into crisis. In a market dominated by a handful of giant firms, that kind of disruption becomes an opening.
Oil companies move fast when crude prices spike. They point to rising benchmark prices and new risks around Hormuz, and raise pump prices right away. Every new headline becomes the reason for another increase.
But the pattern runs one way. When crude prices fall, retail prices do not follow at the same speed. They drift down slowly, after companies have already widened their margins. That is how concentrated capital operates in a crisis — the disruption becomes a chance to take more. Decades of studies have found the same pattern: Gasoline prices rise much faster when crude goes up than they fall when crude comes down.
The same pattern is already taking shape in the war on Iran. The U.S. proxy war in Ukraine in 2022 showed how it plays out.
As sanctions hit Russian crude and oil prices spiked, U.S. gas prices shot to record highs within weeks. When crude later fell, pump prices followed more slowly and unevenly. ExxonMobil, Chevron, Shell and BP went on to post combined profits of roughly $150 billion for the year, the highest in their histories.
The executives did not hide it. When they spoke to investors, they described the Ukraine war as a favorable pricing environment. They moved the windfall to shareholders through buybacks and dividends instead of expanding output in ways that could ease price pressure.
That is the setup again now. ExxonMobil and Chevron are due on May 1 to tell investors how much they made in the first three months of the year. They will point to the Iran war and disruption around Hormuz as reasons prices remain high — and on that point, they will be telling the truth. A war launched by the U.S. government is once again delivering direct gains to the same oil majors.
That is war profiteering. War profiteering runs through military contracts. It also runs through the way war reshapes the market. The disruption pushes prices up, and the oil majors are in position to grab a bigger share. Working people pay more at the pump, and the oil majors pocket the difference.
The Federal Trade Commission has the authority to investigate price gouging in the petroleum industry. The Trump administration will not do it. But the problem runs deeper than inaction. The same state that wages war and enforces sanctions is helping create the conditions for these profits in the first place. Treasury Secretary Scott Bessent and Interior Secretary Doug Burgum have made clear that expanding fossil fuel production and protecting oil profits are priorities, not abuses to be checked. The oil majors spent heavily to help put this administration in office. Now they are collecting.
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