Full Breakdown
Oil and Gas Industry Faces Uncertainty Amid Iran Conflict
4/24/2026, 11:04:27 AM
Overview of Industry Expectations
A recent survey conducted by the Federal Reserve Bank of Dallas, involving 120 oil and gas firms, reveals significant concerns regarding the ongoing military conflict in Iran and its impact on the Strait of Hormuz, a vital shipping route for global oil supplies. The survey, conducted between April 15 and 20, 2026, included responses from 78 exploration and production (E&P) firms and 42 oilfield services firms.
Traffic and Shipping Cost Projections
Executives expressed skepticism about the quick normalization of traffic through the Strait of Hormuz. Only 20 percent anticipate a return to normal levels by May 2026, while 39 percent expect recovery by August, 26 percent by November, and 14 percent predict it will take longer. Furthermore, a majority of respondents foresee increased shipping costs post-conflict, with 36 percent expecting an increase of more than $2 but not more than $4 per barrel.
Future Disruptions and Production Outlook
The survey indicates a prevailing belief among executives that geopolitical events will likely disrupt traffic in the Strait of Hormuz again within the next five years. Specifically, 48 percent consider future disruptions "very likely," and 38 percent view them as "somewhat likely." In terms of U.S. oil production, 43 percent expect an increase of more than 0 but not more than 0.25 million barrels per day (mb/d) in 2026, while 32 percent predict an increase of more than 0.25 but not more than 0.50 mb/d in 2027.
Employment Projections
Regarding employment changes from December 2025 to December 2026, 59 percent of executives expect employment levels to remain stable. Approximately one-third foresee a slight increase, while only 8 percent anticipate a decline. Notably, E&P firms predominantly expect stability, whereas oilfield service firms are more inclined to predict slight increases in employment.
Criticism of Government Response
The survey results reflect growing frustration within the oil and gas industry regarding the Trump administration's handling of the situation. Executives have criticized the administration's assurances about the swift reopening of the Strait of Hormuz and the quick return to normalcy in oil markets. One executive remarked, “The administration’s comment about an ‘Iran terror premium’ existing for decades with crude oil pricing is laughable,” highlighting the industry's skepticism about government narratives.
Official Statements and Responses
White House spokesperson Taylor Rogers pointed to some optimistic survey responses, suggesting they align with the administration's stance that disruptions are temporary. She stated, “President Trump has been clear that these are short-term, temporary disruptions,” emphasizing ongoing efforts to manage the situation.
Conclusion
The Dallas Fed's Q1 2026 Energy Survey underscores the oil and gas industry's cautious outlook amid the Iran conflict. With expectations of prolonged disruptions, rising shipping costs, and a measured increase in U.S. production, industry leaders are navigating a complex geopolitical landscape that continues to shape their operational strategies.
