BP's quarterly profit more than doubled to almost £2.4bn, underscoring how a sharp rise in oil prices since the Iran conflict has handed energy firms bumper earnings while helping push US stock indexes to fresh records. The company reported the jump as wholesale prices surged and concerns about supply through the Strait of Hormuz unsettled markets. US markets closed at new highs as firms from Alphabet to Caterpillar beat expectations, and traders drove wild swings in Brent crude, with futures briefly topping $119 for nearby contracts before pulling back.

Who is making money

Big oil firms are the clearest winners. BP said its quarterly profit more than doubled from the prior year to almost £2.4bn, according to company figures reported in the British press. That jump came as wholesale prices rose sharply after the conflict began and supply routes through the Persian Gulf were disrupted.

The rise in wholesale prices has fed directly into company earnings. The Mirror reported that Brent crude climbed from roughly $60, $70 a barrel before the war to highs above $119 a barrel, a move that lifted revenues for producers while hitting consumers at the pumps.

Large listed companies outside energy have also benefited, though for different reasons. US firms such as Alphabet and Caterpillar reported quarterly results that beat expectations.

That helped push the S&P 500, Dow Jones Industrial Average and the Nasdaq to record closes in late April even as oil markets swung wildly.

Alphabet’s quarterly profit came in far ahead of analysts’ forecasts. Alphabet chief executive Sundar Pichai said that investments in artificial intelligence, "are lighting up every part of the business," and the stock rallied roughly 10% on the news. Caterpillar rose nearly 10% after delivering stronger profits, while pharmaceutical and retail names such as Eli Lilly and O’Reilly Automotive also jumped on robust results.

How oil markets are behaving

The oil market has been volatile. Traders piled into futures as concerns over Middle East supply grew. In the most active Brent contract for July delivery, prices surged above $114 a barrel overnight and at one point traded as high as $114.70, then fell back and settled near $110.40, according to market data reported by US wire services.

The overall peak for the war so far was higher. Earlier in the conflict Brent reached about $119.50 per barrel for the most-active contract, while a less liquid June contract briefly traded above $126 before easing. Those swings show how futures pricing can stray as traders scramble to hedge shipments and storage.

Two physical factors are driving the tightness. Iran has closed the Strait of Hormuz to oil tankers, constraining shipments from the Gulf. At the same time, a US naval blockade has made it harder for Iran to export its own crude. With a fifth of the world’s oil normally transiting the route, the restriction has forced ships to sit in the Gulf or reroute, and it has left buyers and sellers competing over available barrels.

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Winners, losers and the politics of profit

Energy producers win when prices climb. That effect is straightforward. Higher crude prices lift revenue and can boost quarterly profits, as BP’s results showed. Company executives stress the work of staff keeping assets running. Meg O’Neill, BP’s new chief executive, said: "BP’s team has been working relentlessly to keep our assets producing safely, reliably and efficiently. We're working with customers and governments to get fuel where it’s needed, helping minimize disruption and the impact it can have on people’s lives."

Campaigners argue the gains come at social cost. Simon Francis, coordinator for the End Fuel Poverty Coalition, said: "These astronomical profits are a startling reminder that when conflict drives up the price of oil and gas, energy companies profit and households pay." Maja Darlington, climate campaigner for Greenpeace UK, added: "The oil industry’s capacity to profiteer from human misery is almost limitless."

Patrick Galey, head of news investigations at Global Witness, linked the current bonanza to previous episodes when conflict pushed energy prices up. He said: "It is horrifying to see BP’s profits grow as millions suffer the fallout from the US-Israel war on Iran. Unfortunately we’ve been here before, when Russia invaded Ukraine four years ago we saw big oil firms make bumper profits from spiralling fuel costs."

At the same time, broader equity markets have found support in strong corporate earnings outside energy. Tech firms have reported surging profits driven by demand for new services and investments in artificial intelligence. Those gains helped stocks climb even though high oil prices tend to sap consumer confidence and raise costs for businesses.

The economic hit for households and governments

The rise in wholesale prices is filtering through to consumers. The British press reported immediate pain at the pumps for drivers and warned that household energy bills could rise further. Higher petrol and diesel prices lift inflation, and that can erode living standards while complicating fiscal choices for governments.

Inflationary pressure also affects central bank decisions. If energy costs keep inflation elevated, policymakers may face pressure to hold interest rates higher for longer. That, in turn, influences mortgage costs and borrowing for households and businesses. The combination of higher prices and tighter monetary conditions can damp demand and slow growth.

For the UK specifically, the short-term impact is visible in fuel prices, import bills and inflation statistics. The country imports refined fuels and significant volumes of crude, so a sustained period of higher oil prices raises the cost of energy delivery and widens the bill for businesses that rely on transport and logistics.

Speculators and commercial traders add to the volatility.

This pattern of one contract trading at far higher levels than others shows how shorts and longs can push nearby barrels to spike when shipments look uncertain. That creates disproportionate moves in the most-active contracts even if longer-dated contracts remain steadier.

For companies that produce and store oil, the price gap can be profitable. For consumers, it means one week of extreme prices and another of partial relief, but the overall level remains higher than pre-war norms. Analysts cited in the British press warned that the bonanza for producers could continue so long as the route through the Gulf stays restricted and buyers compete for scarce supply.

The flow of profits raises political questions at home and abroad. Governments face pressure to shield consumers from price spikes while avoiding policies that discourage energy companies from maintaining supply. UK watchdogs and campaigners will press for transparency and measures to protect vulnerable households.

Internationally, the interplay between naval blockades and closed sea lanes has forced trading partners to adjust shipping routes and contractual terms. Those changes add cost and time to global supply chains. Energy security has moved up political agendas, while trade partners weigh the impact on growth and inflation.

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BP’s profit more than doubled to almost £2.4bn, a sharp contrast with the pressure higher fuel and household energy costs are placing on consumers.

This article was created with AI assistance.