Iran War Sparks Fuel Shortage Warnings from Oil Executives
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Source: NASDAQ.COM
- Fuel Shortage Warning: Chevron CEO Mike Wirth warns that physical fuel shortages will begin due to the closure of the Strait of Hormuz, predicting that this will lead to economic slowdowns and affect the prices of various products and services.
- Historical Impact: Wirth notes that the current supply issues could be as severe as the 1970s OPEC embargo, leading to soaring gas prices and fuel rationing, with consumers facing higher prices and longer wait times at gas stations.
- Industry Response: Shell CEO Wael Sawan concurs, stating that the Iran war has already reduced global jet fuel consumption by about 5%, and oil and gas shortages may persist into next year, potentially harming transportation companies due to rising fuel costs.
- Rising Consumer Goods Costs: Procter & Gamble anticipates an additional $1 billion in costs due to rising oil prices and plans to raise prices to pass on some of these expenses, which may suppress consumer spending and impact sales of discretionary items like appliances and apparel.
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Analyst Views on CVX
Wall Street analysts forecast CVX stock price to fall
19 Analyst Rating
15 Buy
4 Hold
0 Sell
Strong Buy
Current: 183.030
Low
158.00
Averages
176.95
High
206.00
Current: 183.030
Low
158.00
Averages
176.95
High
206.00
About CVX
Chevron Corporation is an integrated energy company. The Company produces crude oil and natural gas; manufactures transportation fuels, lubricants, petrochemicals and additives; and develops technologies that enhance its business and industry. The Company’s segments include Upstream and Downstream. Upstream operations consist primarily of exploring for, developing, producing and transporting crude oil and natural gas; liquefaction, transportation and regasification associated with LNG; transporting crude oil by major international oil export pipelines; processing, transporting, storage and marketing of natural gas; carbon capture and storage; and a gas-to-liquids plant. Downstream operations consist primarily of the refining of crude oil into petroleum products; marketing crude oil, refined products, and lubricants; manufacturing and marketing of renewable fuels, and transporting of crude oil and refined products by pipeline, marine vessel, motor equipment and rail car.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Operational Role: If approved, Chevron would become the operator and lead the gas exploration in Block 2 in the Ionian Sea, with Helleniq Energy retaining a 30% stake, which currently holds 100% of the concession rights, indicating a significant shift in operational control.
- Data Evaluation Extension: The Greek government is considering granting Chevron and Helleniq more time to evaluate completed seismic data, which will influence their decision on exploratory drilling, reflecting the government's emphasis on foreign investment participation.
- Partnership Dynamics: Chevron and Helleniq are partners in several offshore exploration blocks, having recently signed lease agreements for four offshore blocks south of Crete and the Peloponnese, demonstrating a deepening collaboration in the Greek market.
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- Negotiation Progress: American oil giants Chevron, Exxon Mobil, and ConocoPhillips are in discussions with Venezuelan officials regarding terms under the new oil and gas laws, with Wirth expecting specific information on corporate income tax and royalties to be disclosed soon.
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- Resource Potential: The block is adjacent to Exxon's Stabroek block, which has made 30 discoveries totaling 11 billion barrels of recoverable oil and gas, currently producing 900,000 barrels per day and aiming for 1.7 million barrels by 2030, indicating significant upside potential.
- Investment Plans: ExxonMobil plans to invest $42 million for seismic surveys and potentially drill two exploration wells six months post-survey completion, which could provide Occidental with a long-term growth catalyst if successful.
- Strategic Implications: This acquisition allows Occidental to replenish resources to counter production declines while further diversifying its investment portfolio globally, thereby enhancing its competitive position in the oil and gas sector.
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