Global Economic Shockwaves: Winners and Losers of the US-Israel War on Iran

Six months after the United States and Israel initiated their military conflict against Iran, sending shockwaves through global energy markets, the economic fallout continues to spread across numerous sectors worldwide. While the ongoing war has severely strained many industries, it has simultaneously generated unprecedented financial windfalls for others.

Winner: Oil companies
The shutdown of the Strait of Hormuz, compounded by Iranian attacks on energy infrastructure throughout Gulf nations, has caused oil prices to skyrocket. Consequently, major energy corporations have reported massive profits. ExxonMobil announced a $14.5bn profit for the second quarter—its highest quarterly earnings in four years—while Chevron posted $12bn. France’s TotalEnergies reached $6bn, and British firms Shell and BP more than doubled their earnings year-on-year, bringing in $9.8bn and $5.73bn respectively. Analysts note that European energy companies benefited further from oil trading operations. Meanwhile, regional producers like Saudi Arabia's Saudi Aramco netted $33.4bn, though others like the Abu Dhabi National Oil Company (ADNOC) experienced a 52 percent profit drop due to logistical disruptions in the Strait of Hormuz.

Losers: US taxpayers
US Defense Secretary Pete Hegseth informed Congress that the war cost an estimated $37.5bn up to late July. However, experts like Linda Bilmes from Harvard Kennedy School argue this figure only accounts for short-term munitions costs and ignores long-term expenditures such as military installation repairs and decades of disability payments, suggesting total budgetary costs could ultimately reach $1 trillion.

Winner: Defence firms
To replenish depleted stockpiles of Patriot and Terminal High Altitude Area Defense (THAAD) interceptors, the Pentagon awarded massive contracts, including a $22.9bn agreement with RTX Corporation for Tomahawk cruise missiles and a $59bn deal with Lockheed Martin to triple Patriot interceptor production. Despite high demand, stock performances among defense contractors have varied, with Northrop Grumman shares dropping 25 percent and Boeing down 8 percent, while Lockheed Martin rose 14 percent.

Loser: The world’s hungry
Elevated fuel and fertilizer expenses have driven up global food costs, threatening vulnerable populations. The UN's Food and Agriculture Index reached its highest level since January 2023, while the World Food Programme estimates an additional 7.1 million people in Somalia, Afghanistan, and Sri Lanka are struggling to secure adequate food supplies.

Winner: Banks
Market volatility has triggered a surge in trading activity. Major US financial institutions including JPMorgan, Bank of America, Citigroup, and Wells Fargo collectively netted $42.5bn in second-quarter profits, while international lenders like the UK's HSBC and France's Societe Generale also reported substantial earnings growth.

Loser: Airlines
The aviation sector faces severe headwinds due to airspace restrictions, longer flight routes, and high jet fuel prices. The International Air Transport Association projects Middle Eastern airlines will face a $4.3bn collective loss, and carriers globally—such as Air New Zealand, which reported a $200m loss—are absorbing the financial impact.

Winners: Renewables and coal
High fossil fuel prices have accelerated clean energy adoption, with the International Energy Agency projecting electric vehicles will account for 29 percent of sales in 2026. Simultaneously, thermal coal has seen a resurgence; South Africa's Thungela Resources doubled its half-year profits as Asian nations ramped up coal-fired electricity generation, with exporters like Indonesia also capitalizing on higher prices.

Losers: Carmakers
Manufacturing-heavy automakers are struggling with increased costs for aluminium, plastics, and paint, compounded by supply chain disruptions. Toyota reported a nearly 5 percent global sales decline in July, and Volkswagen saw its second-quarter earnings drop by nearly one-third.