Blogger Comment: We know that Trump is no saint, but things are better in the US now for the American people…but he has made one major mistake that all US presidents make with his involvement with Iran and that was not well thought out from the very start…as Iran was no imminent threat to the USA or the West, the decision that caused energy and especially petrol prices to skyrocket and NOT a great judgement at all for re-election prospects…basically shooting himself and the Republics in the foot just for the highly toxic leadership of Israel and where the people of Israel never wanted a war with Iran, but wanted to leave it to the inspections by the interbational nuclear watchdog…
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Energy giants ExxonMobil and Chevron warned Friday that Americans are unlikely to see relief at the gas pump anytime soon, citing ongoing supply disruptions tied to the Iran conflict that continue to squeeze global fuel markets.
The warnings came as both companies posted massive second-quarter profits, driven in large part by soaring refining margins as diesel, gasoline, and other refined petroleum products remain in short supply.
ExxonMobil reported second-quarter earnings of $14.5 billion, more than doubling its profit from the same period last year.
Revenue climbed 42% to $116 billion.
Chevron also posted a strong quarter, reporting $12.1 billion in earnings on roughly $70 billion in revenue.
Refining Bottlenecks Keeping Fuel Prices Elevated
Executives at both companies said today’s fuel prices are being driven less by crude oil costs and more by a shortage of refining capacity.
They pointed to multiple factors constraining global fuel supplies, including disruptions to shipping through the Strait of Hormuz stemming from the conflict with Iran, declining fuel exports from China, and refinery outages in Russia following attacks on energy infrastructure.
ExxonMobil CEO Darren Woods said those disruptions have reduced global refining capacity by nearly 9%.
Speaking with CNBC, Woods cautioned motorists not to expect lower prices in the near future.
“I wouldn’t hold my breath here in the short term,” Woods said when asked whether gasoline prices could soon fall.
“I think we’re going to see prices consistent with what we’re experiencing for quite a while yet.”
‘Disconnect’ Between Crude Oil And Pump Prices
Woods said the traditional relationship between crude oil prices and gasoline prices has broken down because refining capacity, not crude supply, is now the primary constraint.
“There’s a disconnect today because now we have a refinery constraint,” Woods explained.
“So pump prices are being established by the supply and demand of refining petroleum products, not crude.”
“That’s one of the reasons why we haven’t seen crude rise as quickly as people have thought or we didn’t see product prices fall as crude prices came down because there is this disconnect in the marketplace.”
Woods said the situation is unlikely to improve until shipping through the Strait of Hormuz fully normalizes and global fuel inventories are replenished.
“But until you get flows established in resupplying the marketplace, I think we’re going to see prices consistent with what we’re now experiencing for quite a while yet as we’ve got to get the strait opened up and then we’ve got to resupply the inventories and get things moving,” he said.
“So I wouldn’t hold my breath here in the short term for that.”
Chevron Echoes Warning
Chevron CEO Mike Wirth delivered a similar assessment during the company’s earnings call.
“We’re going to see some upward pressure on product pricing… into the third quarter and perhaps beyond that,” Wirth said.
He added that demand for distillate fuels, including diesel and heating oil, remains strong, while inventories of gasoline and other refined products remain unusually low.
Chevron also reported record throughput at its U.S. refineries of more than one million barrels per day as the company works to maximize production.
Tight Supplies Could Last For Months
U.S. gasoline prices had already climbed above $4 per gallon before the companies released their earnings.
The outlook could become even more challenging as refineries enter scheduled maintenance during the third quarter, temporarily reducing production capacity.
Chevron estimated planned maintenance would reduce downstream earnings by between $175 million and $225 million during the current quarter, while ExxonMobil said its maintenance schedule would be somewhat lighter than in the previous quarter.
Both companies indicated that even if crude oil prices moderate, consumers could continue paying elevated prices for gasoline and diesel until global shipping routes stabilize and fuel inventories are rebuilt.
Woods also warned that reopening the Strait of Hormuz alone will not immediately resolve the problem, noting that shipping companies are likely to remain cautious before returning vessels to the region, potentially extending supply constraints well beyond the end of the conflict.
Follow the link for the source… https://slaynews.com/major-oil-firms-warn-high-gas-prices-persist-iran-conflict-global-fuel-supplies/
And,
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