By Alex Kozul-Wright

While energy prices have soared since the start of the war in Iran, there has been something of a disconnect with the stocks moves of oil-and-gas companies.

Crude has risen 38% since Feb. 27, the last trading day before the war started. In the 10 days after fighting began, however, shares in big energy companies barely budged at all. Exxon, for instance, only inched up 0.3% during that period.

But by early Thursday the lag between the two was beginning to fade. Exxon, Occidental Petroleum and Cheniere Energy shares were all rising in early trading -- by 0.6%, 3.4% and 2.4%, respectively, in line with broader oil price moves -- Brent crude futures, the international benchmark, were up 7.5%, and Crude Oil Continuous Contract futures were rising 7.6%.

The initial disconnect may have been caused by a risk of moving too fast with energy companies themselves vulnerable to supply disruptions. Exxon, for instance, has a partnership with QatarEnergy, which last week had to declare force majeure in the wake of an Iranian drone strike at one of its plants. So investors may have been waiting to evaluate the lay of the land.

Up to now, investors may also have dismissed the investment opportunity thinking the conflict would be brief with an end of the war triggering a sharp reversal in stock prices. However longer-dated energy futures are beginning to reflect the possibility of a prolonged conflict and this could be a pivot point for the stocks.

Until recently, long-dated oil futures hadn't risen by much, implying that investors were pricing in a short conflict. But that is beginning to change. "We know that investors are pricing in the longer scenarios, because the 6-month Brent future is also up 3.06% this morning to $82.97 a barrel, and with each passing day it gets harder to argue that the disruption to shipping and energy infrastructure will only prove temporary," said Deutsche Bank strategist Henry Allen in a note published Thursday.

If energy traders continue pricing in the possibility of a long conflict, that should offer further lift for oil-and-gas companies.

Write to Alex Kozul-Wright at alexander.kozul-wright@barrons.com

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March 12, 2026 11:13 ET (15:13 GMT)

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