- U.S. shale producers could earn an extra $63.4 billion in 2026 if WTI Crude averages $100/barrel, benefiting those without Middle East exposure.
- Most producers are cautious, likely using windfall cash for shareholders, debt repayment, and hedging rather than increasing output due to price volatility.
- International supermajors with Middle East operations face losses, while consumers bear the highest costs, with U.S. gasoline spending rising sharply.
Shale-focused US oil producers could generate $63.4 billion in extra cash flow if the U.S. benchmark averages $100 per barrel this year, intelligence firm Rystad Energy says.
Following the oil price spike to $100 per barrel last week amid the escalating war in the Middle East, US President Donald Trump touted the benefits for the producers, now that his campaign pledge to slash energy costs for consumers by 50% is not mentioned in the White House’s PR campaign to contain the fallout from the war on the American consumer.
US producers, however, will benefit – those that don’t have exposure to the Middle East and are not forced to shut down or restrict operations in a war region with the world’s most important oil chokepoint closed.
If WTI Crude, the US benchmark, stays at very high levels and averages $100 per barrel for 2026, U.S. producers are poised to reap an additional $63.4 billion cash flow, per Rystad Energy data cited by the Financial Times.
To be sure, most analysts don’t expect $100 oil for a prolonged period of time, although short-term spikes are not being ruled out amid the continued closure of the Strait of Hormuz.
For U.S. oil producers, the benefits are not as clear-cut as President Trump suggested in last week’s post on Truth Social, later re-posted by the official X account of the White House.
“The United States is the largest Oil Producer in the World, by far, so when oil prices go up, we make a lot of money,” President Trump said in a controversial post that rattled the oil industry.
The oil sector has had to contend with many other image and reputational risks in recent years, apart from the latest suggestion by the U.S. President that it is profiting from a war.
Shale producers are also reluctant to rush to boost oil production, aware that the current price spike may not last and the geopolitical situation is too volatile to allow for planning beyond next week.
It is this uncertainty that is definitely not in favor of US producers. Any excess cash from the high oil prices would likely go to boost shareholder returns, pay down debt, and hedge production for the coming months, instead of raising production, when prices could crumble in a few weeks, before producers could even contract new rigs and crews.
While the producers with mainly U.S. operations would see a windfall from the price spike, the biggest U.S. oil firms, ExxonMobil and Chevron, as well as the other international supermajors with exposure to the Middle East – Shell, BP, and TotalEnergies – are already counting the losses.
Exxon Mobil (NYSE:) has evacuated non-essential staff from the Middle East, CEO Darren Woods told Reuters last week, as operations are being scaled back.
Shell (NYSE:) and TotalEnergies (NYSE:) have declared force majeure to LNG customers after Qatar’s LNG shutdown rippled through global gas markets.
Separately, TotalEnergies said on Friday that the war in the Middle East had effectively shut in 15% of all its global oil and gas output, while the now-offline barrels account for about 10% of the supermajor’s upstream cash flow.
SLB, the world’s top oilfield services provider, last week issued a profit warning and said its first-quarter revenue would be hit by the production shut-ins in the Middle East.
“SLB revenue for the first quarter will be lower than expected, and the company expects to incur additional costs resulting in an impact of approximately 6-9 cents of earnings per diluted share for the first quarter,” SLB said.
The company has begun “to demobilize operations in a few countries in response to customer actions to safeguard personnel and facilities,” the oilfield services giant said.
Overall, shale producers could benefit from excess cash flow in the near term, but the industry doesn’t like uncertainties, which hamper longer-term investment decisions. Supermajors will likely be able to offset Middle East losses with the high oil and natural gas prices.
And the biggest hit is for consumers.
Americans were expected to spend on Sunday $300 million more on gasoline than they did 30 days ago, said Patrick de Haan, head of petroleum analysis at GasBuddy.
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