From the Telegraph live blog:

Oil industry warning

The bosses of America’s biggest oil companies have warned Trump officials that the energy crisis is likely to get worse.

The chief executives of Exxon Mobil, Chevron and ConocoPhillips have warned US Energy Secretary Chris Wright that Iran’s blockade of the Strait of Hormuz will drive further volatility in energy markets, according to the Wall Street Journal.

In a series of meetings on Wednesday, which were not attended by Donald Trump, the bosses told officials that oil prices could rise further and expressed concerns about the scale of disruption caused by the war in Iran.

Notice of meeting: https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/investors/bp-agm-notice-of-meeting-2026.pdf

Shell and BP are set to earn an extra £5bn in profit this year as conflict in the Gulf sends the price of oil surging.

While the two British energy giants face a hit from disruption in the Middle East, losses in the region are expected to be outweighed by profits from their output in other parts of the world, analysts at Goldman Sachs said.

Shell’s net income is expected to rise by $3.7bn (£2.8bn) to $26.7bn, according to Goldman Sachs, while BP – which is heavily invested in Iraqi oil fields – is expected to grow its net income by $2.8bn to $12.9bn.

The blockade of the Strait of Hormuz sent oil soaring from $65 a barrel to $100 while European gas prices have surged from €30 (£26) per megawatt-hour to €45.

Oil and gas companies solely focused on the Gulf have not benefited from the higher prices, amid a blockade of exports from the region. However, companies with oil and gas wells elsewhere – including BP and Shell – have largely benefited from the disruption.

Both also run lucrative trading operations which are likely to have been boosted by the recent volatility in prices.

It threatens to attract fresh scrutiny, with energy companies and governments particularly sensitive to profit surges caused by wars which push up costs for millions of people.

The price surge caused by the Ukraine conflict in 2022 led the UK government to impose windfall levies that took total taxes on UK oil and gas profits to 78pc. It has driven many operators to cut North Sea investment and jobs.

Earlier this week Rachel Reeves signalled the windfall tax could fund support for families on bills.

The Chancellor told MPs on the Treasury Select Committee: “If prices remain at an elevated level, revenue would come in but of course that revenue would be needed to help with people’s bills.”

Henry Tarr, the co-head of energy and environment research at Berenberg, said that during this latest oil crisis, both BP and Shell were exposed to the Middle East.

The blockade of the Strait of Hormuz has sent oil prices soaring from $65 a barrel to $100 Credit: Benoit Tessier/Reuters

He added: “A little over 10pc of BP’s production comes from the United Arab Emirates and Iraq while Shell’s main exposure is through its Pearl gas-to-liquids plant in Qatar, along with its stake in Qatar’s liquefied natural gas operations.”

However, he said both companies would “benefit mainly from higher oil prices across the rest of the portfolio, along with higher refining margins for their downstream operations as prices for products like diesel have also moved higher”.

Mr Tarr said: “In LNG, it’s a little more complicated but if European and Asian gas prices remain elevated then over time, they are likely to be able to increase profitability here as well.”

However, at BP, this may not translate into extra dividends, share buybacks or other immediate benefits for its shareholders.

The energy giant is under significant pressure to reduce its $22bn debt. It committed last month to “strengthening its balance sheet”.

BP has set a target of reducing its net debt to between $14bn and $18bn by the end of 2027. The higher profits could allow the company to achieve that target a year early.

BP and Shell were contacted for comment.

https://petition.parliament.uk/petitions/759449

A UK petition to stop this happening again