In the first four months of 2026, U.S. military actions abroad have reshaped global oil flows in ways markets are still struggling to price. On January 3rd, U.S. special forces captured Venezuelan President Nicholas Maduro from a presidential compound in Venezuela, leaving the country to be run by his second-in-charge, Delcy Rodríguez. Then, on February 28th, the U.S. and Israel began a multifrontal attack on Iran.
One company stands out across both theaters: Chevron. In both Venezuela and the Middle East, Chevron has multi-billion-dollar business interests. While Venezuelan oil exports have risen since January, the war in Iran tells a different story.
Chevron’s stock has pulled back in recent weeks, suggesting that some of these dynamics may already be priced in or are being offset by broader market concerns.
The Strait Chokes, Oil Surges
Amidst a tenuous ceasefire between the U.S. and Iran, the Strait of Hormuz has reopened. However, the waterway, through which 20% of the world’s oil flows, is processing a fraction of the ships it usually does, and is, for all intents and purposes, still closed. Over 1,000 ships wait in a backlog, with only a few passing through the strait per day.
While the virtual standstill of the Strait is hitting consumer wallets, big oil has enjoyed bumper profits. This is especially true for Chevron, whose first-quarter upstream earnings are expected to rise as much as $2.2 billion from the previous quarter.
In the words of RBC Capital Markets analyst Biraj Borkhataria, “Chevron has the lowest exposure to the Middle East across the supermajors, with liquids from the region accounting for just over 1% of group production, leaving it better placed than peers to benefit from the current commodity upside.”
Accordingly, Chevron’s stock price has risen 35% YTD. However, Chevron is also reported to have lost approximately 6% of its global production in the first quarter. Additionally, financial hedging is expected to eat into the increased upstream earnings.
Despite these tailwinds, Chevron’s recent share price movement suggests that markets may be discounting the durability of these gains.
Markets Are Mispricing the Shock
Chevron CEO Mike Wirth believes that the impact of the Iran War has not been priced into the market. While Chevron is less exposed to the region than any other supermajor, it still has ships waiting on either side of the Strait of Hormuz. Additionally, to meet demand, Chevron has rerouted tankers from the Gulf of Mexico through the Panama Canal to refineries in California.
In late March, Wirth said: “The markets are trading on some scant information and perception…There are very real, physical manifestations of the closure of the Strait of Hormuz that are working their way around the world and through the system that I don’t think are fully priced into the futures curves on oil.”
However, current price action in energy equities indicates that investors may be weighing these supply disruptions against broader macro risks, including demand destruction and recession concerns.
Indeed, while a cease-fire has been brokered between the U.S. and Iran, oil prices have whipsawed and currently trade for just shy of $100 per barrel. Uncertainty looms in the region. Even if the conflict in Iran is coming to a close, what comes next is undetermined, and the damage inflicted has yet to be fully assessed.
A Policy Flip That Changes Everything
For the fiscal year of 2025, Chevron reported its lowest profits since 2021, the 30% decrease attributed to lower crude prices. Some analysts questioned whether Venezuela could be a source for higher profits.
During Chevron’s fourth-quarter earnings call, Wirth discussed Venezuela, stating: “It’s a large resource that has the opportunity to become a more sizable part of our portfolio in the future. But we also need to see stability in the country. We need to have confidence in the fiscal regime.”
The Chevron earnings call was on January 30, 2026. One day earlier, on January 29th, Venezuela’s acting president Delcy Rodríguez signed a law, allowing private companies to control oil production in Venezuela, a reversal from decades of policy going back to Hugo Chavez.
The Law Amending the Organic Hydrocarbons Law (the “Hydrocarbons Law Amendment”) grants foreign companies the independence to operate, export, and sell Venezuelan oil, even if they are minority stakeholders in the state-run oil company PDVSA.
Now, in April, Chevron is nearing an agreement with Venezuela to expand its largest oil project, Petropiar, located in the resource-rich Orinoco Belt. The deal would grant Chevron the rights to extract oil from the Ayacucho 8 area, a significant block of proven reserves situated south of the existing Petropiar site.
This expansion would allow Chevron to significantly boost its production and export of extra-heavy oil. If finalized, the project could position Chevron as the largest private oil producer in the Orinoco Belt, which holds more than three-quarters of Venezuela’s total crude oil reserves.
A Windfall Built on Instability
The war in Iran has spiked oil prices globally. American big oil is profiting, although not evenly. Chevron is particularly well-positioned due to its limited exposure to the Persian Gulf region. Additionally, Chevron is uniquely positioned in Venezuela to expand exports to the United States.
Even so, equity markets have not fully rewarded this positioning in the short term, reflecting uncertainty over how long current price levels can be sustained.
However, if oil prices remain persistently high through 2026, an eventual economic slowdown is foreseeable. Oil companies aren’t immune to recessions. Moreover, high prices might encourage further interest in renewable energy, a long-term threat to the oil industry.
Chevron’s position in 2026 is not the result of a single event, but of timing, geography, and exposure. The company is positioned to benefit from both higher prices and expanding access, though the timing and magnitude of those gains remain uncertain. For now, the gap between Chevron’s positioning and its stock performance reflects a market that is pricing risk as aggressively as opportunity.
Author: Tim Tolka, Senior Reporter
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The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organisations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
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