US Energy Giant's Profitable Boosting Oil Prices, Expensive Gasoline a Problem for Trump

JAKARTA - The surge in oil prices is expected to boost the profits of major US energy companies in the second quarter. However, the rise in gasoline prices is a political problem for President Donald Trump ahead of the November midterm elections.

Quoted from the Anadolu Agency report, Saturday, July 11, high crude oil prices underpin ExxonMobil, Chevron, and ConocoPhillips' revenue projections. At the same time, gasoline prices add to the burden on household budgets in the United States.

The Trump administration faces two conflicting interests. Major energy companies are expected to post strong profits, while the White House is trying to hold down inflation and keep gas prices under control.

Based on estimates from the London Stock Exchange Group or LSEG, ExxonMobil is projected to record net profits of 15.7 billion US dollars in the second quarter. The figure is almost three times higher than the first quarter profit.

The projection is supported by high crude oil prices during the US-Israel-Iran conflict as well as larger processing margins. Processing margins are the difference between crude oil prices and the value of finished products such as gasoline or diesel.

Chevron is expected to post net profit of $9.9 billion, more than triple the first quarter. ConocoPhillips is also projected to earn higher profits thanks to strong production performance.

Oilfield services companies are also expected to record better results. SLB is considered to be one of the biggest beneficiaries of the new investment cycle driven by the growth of digital technology and data center development.

Halliburton also stands to benefit from increasingly limited service capacity in North America.

The rise in crude oil prices has begun to spill over to gas stations and put pressure on household budgets. This condition has the potential to become an important issue in the midterm elections that will determine Congress' control.

On June 24, Trump said the decline in crude oil prices had not been fully felt by consumers. He then asked the United States Department of Justice to investigate the matter.

Trump assessed that large oil companies were not fast enough to pass on the decline in crude oil costs to consumers. According to him, American citizens are still paying too high a price for fuel and gas prices should have fallen faster.

Geopolitical tensions and tighter sanctions against Iran continue to support oil prices. Even so, Brent oil prices are still far below the levels recorded in April and May.

Osama Rizvi, an energy and economic analyst at Primary Vision Network, told Anadolu Agency that the current market conditions are worthy of being called "war-driven profits".

He assessed that 2026 was a very profitable year for the oil industry, but consumers also bear the cost. Rizvi also highlighted the weakening labor trend and consumer confidence levels, which are at very low levels.

According to Rizvi, high gasoline prices are a political risk for Trump and the Republicans ahead of the midterm elections.

"The President of the United States understands that in an election year, they should not face two things, namely high gas prices and coffins," said Rizvi.

He said the term "body bag" was related to the possibility of Trump expanding the conflict to Iran. While gas prices show how long the United States can maintain hostilities.

Rizvi added that oil and processed products were starting to run out. The processed product market is also facing shortages, while the gap between product prices such as gasoline and crude oil has reached the highest level in several years.

Amid the open pressure, the White House's relationship with the energy industry remains strong.

Independent oil market analyst Gaurav Sharma said concerns that oil prices would jump to $175 to $200 a barrel at the start of the conflict have not been proven. Strong US supplies are one of the restraints.

"Oil prices above $100 per barrel directly benefit US companies as Asian buyers line up to buy light crude oil with low sulfur content from the US," Sharma told Anadolu Agency.

He predicted Trump would increase pressure on energy companies if gasoline prices remained high ahead of the election. Friction between the White House and the industry is also expected to continue.

However, Sharma assessed that tensions in the public space did not reflect the relationship behind the scenes.

"The relationship between the White House and the United States energy sector has never been better," he said.

Sharma said the United States is in a strong position as the world's largest oil exporter and LNG exporter. The country is also undergoing the largest energy expansion in a generation.