Exxon Mobil Chairman and CEO Darren Woods said Friday that the oil market has not yet absorbed the full supply shock from the war in Iran and the closing of the Strait of Hormuz, warning that prices will climb further the longer the waterway stays shut.
The comments, delivered on the company's first-quarter earnings call, came as Exxon disclosed that 15% of its production has been hit by the closing and that Middle East output could fall by 750,000 barrels per day this quarter if the strait remains blocked.
Woods told investors that tankers already loaded and in transit when the war began, combined with releases from strategic petroleum reserves and draws on commercial inventories, have masked the scale of the disruption.
Those buffers will not last, he said.
"It's obvious to most that if you look at the unprecedented disruption in the world supply of oil and natural gas, the market hasn't seen the full impact of that yet," Woods said. "There's more to come if the strait remains closed."
The Strait of Hormuz has been closed to commercial traffic since the war began earlier this year, after the U.S. and Israel attacked Iran on Feb. 28. Crude prices have climbed roughly 57% since then.
Even when the waterway reopens, Woods said, normal flows will not return immediately.
Tankers must be repositioned, backlogs cleared, and vessels routed to customers, a process he estimated would take one to two months.
Governments and companies will then need to rebuild depleted reserves, adding fresh demand and pushing prices higher still.
Crude has whipsawed since the war began, climbing on escalation fears and falling on diplomatic openings.
U.S. crude settled down more than 3% on Friday at $101.38 a barrel; Brent fell about 2% to $108, levels that Woods described as more in line with those of the past decade than with the scope of the Middle East disruption.
Exxon also flagged a 3% drop in refinery throughput compared with the fourth quarter of 2025 if the strait remains closed.
Iranian strikes on Qatar's liquefied natural gas export complex damaged two production lines in which Exxon holds an interest, accounting for about 3% of its 2025 upstream output, the company disclosed early last month in a Securities and Exchange Commission filing.
The disruption has not produced the windfall investors might have expected from a price spike.
Exxon reported net income of $4.2 billion, or $1.00 per diluted share, down from $7.7 billion, or $1.76 per share, a year earlier; on an adjusted basis, it earned $1.16 per share.
Chevron reported net income of $2.2 billion, or $1.11 per share, down from $3.5 billion, or $2.00 per share; adjusted earnings came in at $1.41.
CNBC reported that year-over-year net income fell 45% at Exxon and 36% at Chevron.
Both beat analyst estimates but absorbed steep paper losses on hedging contracts opened when prices were lower, with Exxon citing about $3.9 billion in unfavorable derivative timing effects and Chevron $2.9 billion.
Exxon shares were down about 1% in midday trading.
Despite the rise in oil prices since the war began, Exxon's stock is flat over that span.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
© 2026 Newsmax. All rights reserved.