U.S. energy companies are positioned to realize substantial profits amid ongoing conflict in the Middle East, yet major oil corporations are showing reluctance to increase drilling operations, even as the Trump administration urges them to boost output and reduce gasoline prices.

President Trump has publicly called on American energy firms to "Drill, baby drill!" and has threatened investigations into potential industry price-gouging as elevated fuel costs impact consumers, a concern for Republicans leading up to the midterm elections.

However, oil majors are resistant to investing in additional rigs and wells, citing that their current surge in profits is a temporary phenomenon. "I think the industry is strong... We are sitting at a very good position compared to the rest of the world… [but] oil companies are looking at it and saying this is a blip on the radar," Joe Adamski, managing director of supply chain consultancy ProcureAbility, told The Post.

Exxon Mobil projected a potential $5 billion increase in its second-quarter profits, which would bring its adjusted earnings to an estimated $15.7 billion, tripling its earnings from the previous quarter. Analysts anticipate that Chevron and Shell will also report strong second-quarter earnings, following robust first-quarter results that exceeded expectations by 45% and 37% respectively.

"It’s going to be extra billions of dollars, as we saw with Exxon Mobil," said Jeff Krimmel, founder of Krimmel Strategy Group. "It’ll be a multibillion gain across the industry just based on all the disruptions that continue to exist that really peaked toward the end of the second quarter."

The significant financial gains for U.S. oil companies are occurring as attacks on shipping and airstrikes in the Middle East have disrupted passage through the Strait of Hormuz, a critical route for approximately 20% of global oil. This disruption has increased demand for alternatives like U.S. crude, which saw prices surpass $110 a barrel in April.

![An Exxon gas station in Clearwater, Florida, featuring red and white branding and "Synergy" fuel pumps.]( "An Exxon gas station in Clearwater, Florida, featuring red and white branding and "Synergy" fuel pumps.")

Markups on U.S. crude oil reached record levels, with refiners in Asia and Europe competing for limited supplies, leading to premiums of $30 to $40 per barrel. As of Friday, U.S. crude oil futures were trading at $71.25 a barrel, and Brent crude at $75.61, both indicating an end-of-week increase following renewed conflict affecting traffic through the strait.

Trump has advocated for increased fossil fuel production, urging companies to expand drilling and declaring a national energy emergency for January 2025. The Interior Department has proposed expanding offshore drilling in areas near Florida and California, proposals that have faced significant opposition from local politicians concerned about potential oil spills.

In March, the Trump administration exempted drilling in the Gulf of America from the Endangered Species Act, citing national security concerns related to oil supplies during the conflict with Iran. Environmental groups have criticized this decision, warning of risks to wildlife, including endangered whales.

Despite these policy shifts, oil companies have not indicated plans to significantly increase their capital expenditures on new rigs and wells, anticipating that demand will normalize once the conflict concludes, barring any lasting severe damage. In a less favorable scenario for the industry, the collapse of OPEC could lead Saudi Arabia to significantly ramp up production, potentially driving oil prices as low as $40 a barrel.

U.S. crude oil production reached a record high of 13.6 million barrels per day in 2025, according to the U.S. Energy Information Administration, significantly more than Europe's combined production excluding Russia. However, this increase was attributed to efficiencies gained through improved equipment and technology, rather than the addition of new drilling operations.

Data from the EIA indicates that the number of active rigs and wells drilled in the U.S. has actually decreased. "We saw oil prices get above $90, even $100 temporarily during this war, and there was no huge rush to add rigs, to add production," Krimmel noted. "We already had a production surplus going into the war. A lot of analysts are expecting to reapproach that surplus as these flows normalize now."

In May, Exxon Mobil and Chevron stated their intentions to maintain drilling levels close to their initial plans, despite the ongoing conflict. Adamski suggested that concerns about political repercussions may also be influencing the majors' decisions. "They are sensitive to being in a political storm, that they would have a target on their back and Congress will start talking again about windfall profit taxes and things like that," he said.

"So they want to avoid putting in the appearance that they are taking advantage of this, so instead they’re doing share buybacks, they are paying down debt. They’re doing things like that."

Despite the industry's profits, the war's impact on consumers, costing households an estimated $1,000 in increased expenses for fuel, food, and other goods, has drawn scrutiny. Trump has expressed a desire to lower gasoline prices ahead of the midterm elections. The Department of Justice has requested state attorneys general to investigate potential antitrust violations by energy companies, following Trump's accusations of price-gouging.

"I have instructed the DOJ to immediately start looking into this. Gasoline prices better start going down a lot faster than what I’m seeing!" the president posted in June. Gasoline prices have been slow to decrease, averaging $3.88 a gallon as of Friday, after peaking at $4.56 in the spring. Experts attribute this lag to the normal time delay between fluctuations in oil and gasoline prices.

"It really is just politics. The public gets angry when gas prices go up, and politicians need to be seen as being responsive to that anchor," Krimmel stated. "That’s about the extent of the action that you’ll see out of the federal government…There is zero indication that anything nefarious is happening there."