The Motley Fool·2026-03-07 10:30Oil Price Surge and Its Impact on Oil Stocks - The war with Iran has led to a significant increase in oil prices, with Brent crude rising approximately 40% this year from $60 to around $85 per barrel, resulting in a more than 25% increase in average oil company stock prices [1][3]. - The conflict threatens global oil supplies, as Iran has retaliated by attacking oil infrastructure and attempting to impede oil exports from the Persian Gulf, where about 20% of global oil supplies flow through the Strait of Hormuz [3][4]. Company Performance and Strategies - Occidental Petroleum's stock has surged over 30%, while ExxonMobil's shares have increased around 25%, benefiting from higher oil prices that enhance profitability [6]. - Occidental Petroleum has focused on efficiency and debt reduction, expecting to generate an additional $1.2 billion in free cash flow this year, which will increase further with rising oil prices [8]. - ExxonMobil is executing a multi-year strategy aimed at growing its advantaged resources and achieving double-digit annual earnings and cash flow growth at an average oil price of around $65 per barrel, which will be further enhanced if prices remain high [9]. Future Outlook - The continuation of the conflict with Iran could lead to further increases in crude oil prices, potentially exceeding $100 per barrel if Iran continues to disrupt oil flow [5][10]. - Conversely, a rapid de-escalation of the conflict could result in a decline in oil prices and a subsequent decrease in the rally of oil stocks [5][10].