Who are the economic winners and losers of the US-Israel war on Iran? | Economy News
Economic Impact of U.S.-Israel War on Iran: Winners and Losers Identified
Six months after the United States and Israel initiated military action against Iran, the conflict continues to disrupt global energy markets and other sectors of the economy. The war has led to significant challenges for many industries while benefiting others, highlighting a complex landscape of economic winners and losers.
Winners: Oil Companies
The closure of the Strait of Hormuz and Iranian attacks on energy infrastructure in Gulf nations have driven oil prices to new heights since the onset of the conflict. This surge has resulted in record profits for major energy companies worldwide.
ExxonMobil, the largest oil company in the U.S., reported a profit of $14.5 billion in the second quarter of 2026, marking its strongest quarterly earnings in four years. Similarly, Chevron posted a profit of $12 billion—its highest in six years—while TotalEnergies of France saw its earnings rise to $6 billion, up from $3.6 billion last year. British firms Shell and BP also reported notable gains, with quarterly profits of $9.8 billion and $5.73 billion, respectively.
European energy companies have outperformed their U.S. counterparts, according to Ipek Ozkardeskaya, a senior analyst at Swissquote Bank. She noted that supply shortages pose risks, but energy firms are adept at raising prices to mitigate revenue losses.
Despite the regional turmoil, some Middle Eastern oil producers also reported substantial profits. Saudi Aramco announced $33.4 billion in profits for the latest quarter, a one-third increase from 2025. However, the closure of the Strait of Hormuz has affected certain regional producers more severely. In August, the Abu Dhabi National Oil Company experienced a 52% decrease in profits, reporting $665 million compared to $1.39 billion in the previous year.
Losers: U.S. Taxpayers
U.S. Defense Secretary Pete Hegseth recently estimated that the war’s costs have reached $37.5 billion. However, experts indicate that the actual expenses could be significantly higher. Linda Bilmes of Harvard Kennedy School cautioned that this estimate likely only covers immediate military expenditures, overlooking long-term costs that could escalate to $1 trillion, including repairs and disability payments for injured soldiers.
Winners: Defense Firms
The demand for military supplies has increased sharply, particularly for critical systems like the Patriot and THAAD interceptors. On August 17, the Pentagon finalized a $22.9 billion contract with RTX Corporation to enhance production of Tomahawk cruise missiles. The military has also entered into numerous agreements worth tens of billions with other defense manufacturers since the conflict began, including a $59 billion deal to increase Patriot missile production.
Despite this heightened demand, some defense contractors have struggled on the stock market. Northrop Grumman shares have declined by about 25% since the conflict began, while Boeing’s stock has fallen approximately 8%. In contrast, Lockheed Martin’s shares have risen by about 14%.
Losers: Global Hungry Populations
The war’s impact extends to food security, with rising fuel and fertilizer costs contributing to higher food prices, exacerbating hunger for the world’s poorest populations. The Food and Agriculture Organization noted a 0.6% increase in its food price index in July, attributed to factors including drought and rising fuel costs from ongoing conflicts.
The World Food Programme estimates that an additional 7.1 million people in vulnerable nations such as Somalia, Afghanistan, and Sri Lanka are struggling with food shortages due to the war’s consequences.
Winners: Banks
Volatility in the stock market has increased trading activity among financial institutions as investors seek to capitalize on market swings. The “Big Four” U.S. banks—JPMorgan, Bank of America, Citigroup, and Wells Fargo—reported a combined profit of $42.5 billion in the second quarter. Major banks in the UK and France have also posted significant earnings increases during this period.
Losers: Airlines
The aviation sector, particularly in the Middle East, has faced severe challenges due to the conflict. Iranian missile and drone attacks led to the cancellation or diversion of thousands of flights. According to the International Air Transport Association, Middle Eastern airlines anticipate a collective loss of $4.3 billion, compared to a profit of $7.2 billion in 2025.
Air New Zealand recently reported a loss of $200 million for the fiscal year, attributing its downturn to rising fuel costs due to the conflict.
Winners: Renewables and Coal
Both renewable energy and coal have seen benefits amid the ongoing crisis in global energy supplies. The rising cost of fossil fuels has accelerated investments in renewable energy sources, with 26 countries and regions announcing initiatives in response to the conflict. The International Energy Agency predicts that electric vehicles will represent 29% of all vehicle sales in 2026.
Conversely, coal has also found favor; South Africa’s Thungela Resources reported a doubling of profits over the past year, driven by increased global demand.
Losers: Carmakers
The automotive industry has been significantly affected by rising material costs. Toyota reported nearly a 5% decline in global sales for July, marking the sixth consecutive month of decreasing sales. The company’s forecasts indicated a potential loss of $4.3 billion due to the war’s impact on operations and supply lines, compounded by competition from Chinese manufacturers.
Conclusion
As the conflict continues, the economic ramifications are poised to unfold further, impacting various sectors in both predictable and unforeseen ways. Analyzing these winners and losers provides insight into the global economic landscape shaped by ongoing geopolitical conflicts.
