Chevron CEO Mike Wirth has issued a warning regarding the significant and "very real" risks to global oil supplies, citing escalating geopolitical conflicts in the Middle East, particularly tensions involving Iran and Houthi attacks on shipping routes.
Wirth's remarks, made during an appearance on 'Sunday Morning Futures,' underscore the fragility of current energy markets. He noted that threats now extend beyond the Strait of Hormuz to include the Red Sea and the Black Sea, expanding the scope of potential disruptions. "The world energy system has been stressed and the need for supplies to markets and customers has never been higher," Wirth stated.
The conflict with Iran has intensified concerns, with the Strait of Hormuz, a critical global trade waterway, experiencing a significant reduction in traffic. Recent Houthi attacks in the Red Sea have further exacerbated worries about the reliability of essential shipping corridors.
"I think the unfortunate thing is that energy assets have been targeted in this conflict. And what that means is it degrades the capacity of the energy system to meet global demand," Wirth explained. He added that the recovery time for damaged infrastructure will be a key factor in market stabilization. "We've seen supply constrained, we've seen damage to infrastructure. And we have new risks that I think will be priced into the market on shipping."
These global supply concerns coincide with rising energy costs in the United States. U.S. crude oil is trading around $84 per barrel, and the national average for a gallon of gasoline has reached $4.09, an increase of nearly $1 compared to the same period last year, according to AAA.
Despite the volatile environment, Chevron has reported an increase in its own production, with a 20% year-on-year rise and a 5% increase from the first to the second quarter of 2026. Wirth highlighted that the company achieved a record for producing over 2 million barrels of oil equivalent in a single day. He also indicated that Chevron is exploring alternative solutions to circumvent vulnerable Middle Eastern shipping routes, including potential discussions with Iraq for oil field development that could facilitate pipeline construction to the Mediterranean Sea.
"We are in discussions with Iraq about potentially entering one or two oil fields there," Wirth said. "Part of those discussions would include a framework that would allow the construction of a pipeline that would go North and then move to the Mediterranean Sea and create a pathway for that production to get to market that would not have to go through the route today, which is through the Strait of Hormuz."