The world's biggest oil companies are earning more money than at almost any point in their history. Yet the market delivering those profits is shrinking beneath them. The International Energy Agency now expects global oil demand to fall by 1.6 million barrels a day this year, a sharper decline than it forecast just one month ago. The same high prices that are filling corporate coffers are pushing consumers away from the product itself.
A windfall built on disruption
The five supermajors, Exxon Mobil, Chevron, BP, Shell and TotalEnergies, generate a combined profit of $48 billion between April and June. Cash generation across the group reaches almost $90 billion, an all-time high. The driver is not stronger demand but restricted supply. Conflict in the Middle East continues to disrupt shipping through the Strait of Hormuz, a waterway that normally carries around a fifth of the world's oil and gas. With barrels harder to move, prices climb, and producers outside the affected region collect the premium.
Chevron's earnings rise to around $12 billion, roughly four times the figure from a year earlier. Shell records its best quarter since 2022. These are numbers normally associated with a booming market. This market is anything but.
Demand buckles under the price
The IEA's August report tells the other half of the story. Elevated fuel prices and disrupted supply chains are actively destroying consumption. The agency cuts its demand outlook by a further 510,000 barrels a day, and global oil inventories fall to their lowest level since April 2025. Refining capacity is stretched, which keeps petrol and diesel prices painfully high for households and businesses.
In simple terms, the market is squeezing itself. Scarcity raises prices, prices reduce demand, and the industry profits from the imbalance while it lasts.
Politics enters the equation
The windfall is drawing attention. Environmental groups renew calls for windfall taxes, and even President Trump criticises Exxon and Chevron for making too much money from high fuel costs. The companies, for their part, are cautious with their gains. Much of the cash goes towards debt reduction and reserves rather than a spending spree, a sign that boards do not expect current conditions to persist.
A market waiting to turn
The IEA still expects demand to return to growth in the final quarter of this year and to expand by 2.4 million barrels a day in 2027, provided oil flows recover. If the Strait of Hormuz reopens, supply could rebound strongly next year, and prices would likely fall with it. That prospect explains the industry's restraint. Today's profits reflect a disrupted market, not a healthy one, and the companies collecting them appear to understand that better than anyone. The question for investors is how quickly the cycle turns, and who is still holding expensive barrels when it does.
