Anabelle Colaco
04 Aug 2026

HOUSTON, TEXAS: ExxonMobil and Chevron said tight global supplies of diesel and other refined fuels are likely to keep prices elevated through the second half of the year as the war involving Iran continues to disrupt energy markets.

The two U.S. oil giants reported sharp increases in second-quarter refining profits on July 31, helped by falling fuel inventories, reduced exports from China, and refinery outages in Russia, which boosted refining margins.

"We're going to see some upward pressure on product pricing ... into the third quarter and perhaps beyond that," Chevron CEO Mike Wirth said during an earnings call, adding that demand for distillates, including diesel and heating oil, is unlikely to decline over the long term.

The stronger refining profits come as U.S. gasoline prices climbed back above US$4 a gallon last week, creating a political challenge for President Donald Trump and Republicans ahead of the November midterm elections. Both companies said they are maximizing production to help meet demand.

Exxon said its U.S. refineries operated at high capacity during the quarter, resulting in record diesel production. Chevron said its U.S. refineries processed more than 1 million barrels of crude per day, also a record.

Even so, Exxon CEO Darren Woods said restoring shipping through the Strait of Hormuz remains critical to improving crude supplies.

"The utilization that we've seen can't be sustained for the long term. So I think this refining challenge is going to be with the world for a while," he said on CNBC.

Woods added that Exxon has the world's largest refining footprint outside China and said disruptions to crude supplies had increased challenges for its downstream business.

Chevron said planned refinery maintenance in the third quarter is expected to reduce downstream earnings by between $175 million and $225 million. Exxon said scheduled maintenance would be lower in the third quarter than in the previous three months.

Exxon's adjusted downstream earnings rose to $4.1 billion, though RBC Capital Markets analyst Biraj Borkhataria said some investors may have expected even stronger refining results given the company's large refining network.

Exxon narrowly missed analysts' second-quarter earnings estimates, while Chevron exceeded expectations. Exxon's shares fell about one percent, while Chevron's rose roughly two percent.