Oil jumps 8% to $72 on Iran attack; Chevron shares rally
West Texas Intermediate futures jumped 8% to $72 per barrel after U.S. and Israeli strikes killed Iran’s Supreme Leader. Chevron shares rallied as 20 million barrels per day transiting the Strait of Hormuz face disruption risk, boosting free cash flow leverage.
1. Oil Prices Surge on Geopolitical Attack
West Texas Intermediate futures rose over 8% to about $72 per barrel after coordinated U.S. and Israeli strikes killed Iran’s Supreme Leader, marking the largest one-day rally since March 2022 when energy markets were shaken by global conflict.
2. Strait of Hormuz Threatens 20 Million Barrel Flows
Roughly 20 million barrels per day—about 20% of global oil consumption—transit the Strait of Hormuz. Any interference could substantially disrupt exports to major Asian economies, including Japan, South Korea, India and China.
3. Chevron Benefits from Higher Crude Prices
Investors rotated into integrated majors, sending Chevron shares sharply higher. The company’s strong free cash flow and global refining exposure position it to capitalize on elevated oil prices.
4. Conflict Duration Could Determine Market Impact
Geopolitical strategists project the Iran conflict may last one to three weeks, with a possible extension up to two months. Disruption beyond two weeks could put an additional 14 million barrels per day at risk and drive oil prices toward triple-digit territory.