US-Iran War Pressures ExxonMobil's Performance, Profits Plunge 45.45%

ExxonMobil has reported its first-quarter 2026 performance with a net profit of $4.2 billion, down from $7.7 billion in the same period last year. Excluding non-operational factors such as hedging losses and timing effects, ExxonMobil’s profit actually reached $8.8 billion, higher than the $7.6 billion in the first quarter of 2025. This difference is mainly due to accounting impacts from unrealised derivative positions, as well as supply disruptions in the Middle East region that have caused mismatches between financial transactions and physical energy deliveries. “This quarter demonstrates that ExxonMobil is now a stronger and more resilient company in facing disruptions,” said CEO Darren Woods in his official statement, quoted on Saturday (2 May 2026). However, geopolitical tensions in the Middle East have been one of the factors pressuring ExxonMobil’s financial reporting performance. These disruptions have affected production volumes and triggered losses from hedging activities that were not fully compensated. In addition, the company recorded unfavourable estimated timing effects of $3.9 billion. These effects arise from the difference in recognition timing between derivative contracts, which must be valued based on current market prices, and physical oil and gas transactions, which are only recognised upon completion of delivery. Beyond these external factors, ExxonMobil recorded strong operational performance. Oil and gas production in the first quarter of 2026 reached 4.6 million barrels of oil equivalent per day (boepd), an increase from the same period last year. This pressure also highlights ExxonMobil’s business structure, which has significant exposure to the Middle East region. A large portion of the company’s global LNG portfolio is connected to production in Qatar. This means that when the region is disrupted, the impact is directly felt on export volumes, revenue stability, and hedging effectiveness.