Two months into the US-Israeli military campaign against Iran, a stark divide has emerged: as the death toll in Iran climbs above 3,500 and households across the globe face soaring energy costs, two powerful industries – fossil fuel production and arms manufacturing – have recorded explosive profit growth driven by regional instability.
The ongoing standoff between Washington and Tehran in the Strait of Hormuz, one of the world’s most critical energy chokepoints, has left 1,600 vessels and 20,000 seafarers stranded in the Gulf, pushing international Brent crude prices above $107 per barrel. This supply disruption has sent shockwaves through global energy markets, putting unprecedented financial strain on millions of households across Europe, Asia and beyond, while creating windfall gains for major energy and defense players.
New data from the Stockholm International Peace Research Institute (Sipri) underscores the long-term growth of the global defense sector: 2025 marked the 11th consecutive year of rising global military spending, which hit a record $2.887 trillion. For the fossil fuel industry, analysis from climate advocacy group Global Witness conducted for *The Guardian* reveals that major oil and gas conglomerates pulled in more than $30 million in excess profits every hour during the first full month of the Iran war.
In the United Kingdom, the impact on household finances is already severe: projections indicate annual energy bills will jump by as much as £300 ($406) starting in July, driven by supply disruptions from the Strait of Hormuz. New polling shows 44% of UK households will be unable to afford these increases, and the crisis has also deepened global food insecurity, as higher energy and transportation costs push up food prices worldwide. Even as ordinary families struggle to heat their homes, top executives at the UK’s largest energy firms have seen their personal wealth surge by millions of pounds.
For example, in the month following the launch of US-Israeli strikes in late February 2026, Harbour Energy CEO Linda Cook saw the value of her company shareholdings jump by more than £4 million, bringing her total stake to £26 million. Shell CEO Wael Sawan’s shares rose by nearly £1.8 million to £13.2 million, while Centrica chief Chris O’Shea gained more than £300,000 in share value and BP deputy CEO Carol Howle’s stake grew by over £500,000, according to data from the End Fuel Poverty coalition. Globally, the trend holds: Chevron CEO Michael Wirth saw his stake gain more than £44 million in value, while Norwegian energy giant Equinor, a major gas supplier to the UK, saw its share price climb by more than 45%.
Jagannadha Pawan Tamvada, a business economics professor at Kingston University, explained that global oil and gas pricing works to the benefit of producers during supply shocks. “Disruptions in supply anywhere in the system raises prices everywhere,” Tamvada told Middle East Eye. Because consumer demand for energy is relatively inflexible, price increases directly translate to higher revenues and profits for energy producers, with all costs passed down to households.
The same profit dynamic plays out in the defense sector. The United States is currently spending an average of $1.8 billion per day on its military involvement in the Iran war, and Lockheed Martin, the largest Pentagon contractor, has seen its stock price jump by nearly 40% since the start of 2026. Tamvada notes that expectations of future instability automatically lift defense stock values, as market actors price in increased government military spending. “The cost of such instability is not felt by these corporations but rather experienced as a benefit. In effect, risk is socialised downward to consumers while upside is concentrated upwards,” he said.
Ruth London, a founding member of campaign group Fuel Poverty Action, argues that energy companies are not just passive beneficiaries of price shocks – they are exploiting the crisis to pad their bottom lines. “It is not that a shortage increases the companies’ costs. Instead they charge more because they can. They pocket the difference,” she said. She added that the fossil fuel industry, which already causes death through fuel poverty, oil conflict, pollution and climate change, has profited enormously from the Iran war while continuing to receive billions in government subsidies. In the UK alone, an estimated 10,000 excess deaths each year are linked to cold-related illness caused by fuel poverty, even as energy executives rake in windfall gains that deepen already extreme inequality.
“Oil and gas price shocks are like Christmas for fossil fuel companies: they can sit back and watch as their profits multiply,” said Philip Evans, senior climate campaigner at Greenpeace UK. Evans called on governments to implement robust new taxes on the extraordinary profiteering occurring during the crisis to prevent ordinary households from bearing the entire economic burden.
Forty leading UK civil society organizations have joined that call, sending an open letter to the British government through Tax Justice UK urging the chancellor to impose a strong windfall tax on corporate profiteering from the Iran war. “During these times of global crises, certain companies make record profits amidst human suffering in Iran and ordinary people in this country end up footing the bill,” said Caitlin Boswell, deputy director of Tax Justice UK. She explained that years of corporate lobbying have left the UK tax system structured to protect wealthy corporate interests, allowing firms to evade taxes while continuing to receive taxpayer-funded subsidies for fossil fuel production.
The UK previously implemented a windfall tax on energy companies that raised £6.8 billion in 2022-2023 following the energy shock caused by Russia’s invasion of Ukraine, but widespread negative media coverage – shaped by the fossil fuel industry’s media influence – undermined public support for the policy. Today, polling from YouGov shows the cost of living crisis remains the top issue for UK voters, but the ruling Labour government has refused to impose new taxes on energy firms profiting from the current price spike. According to Boswell, this inaction “just goes to show the sheer power of these vested interest groups and these industries that have… too much political capture.”
Patrick Galey, head of investigations at Global Witness, describes the fossil fuel industry as the richest and most powerful industry in human history, and also the most devious. After decades of denying the reality of human-caused climate change, Galey says the industry has continued to deliberately obfuscate and delay climate action even after the scientific consensus became undeniable. The Iran conflict marks the second major global energy shock in five years, following the 2022 shock from the Ukraine war, and forecasters warn the fallout from the current crisis will be far more severe.
Galey argues the core lesson from this crisis is the urgent need for a permanent global transition away from fossil fuels to renewable energy – a shift that is critical not just for climate stability, but for global geopolitical freedom. “Energy independence engenders genuine geopolitical freedom and independence because you are not having to constantly tiptoe around the autocrats that you want to buy fossil fuels from,” he said, pointing to Spain as an example of a nation that has gained greater diplomatic leverage by reducing its reliance on imported fossil fuels. Galey says continued dependence on fossil fuels is a deliberate policy choice, noting that Labour ministers met with fossil fuel lobbyists more than 500 times in their first year in office, and new Labour MPs accepted more than £45,000 in campaign donations from oil and gas companies.
Fossil fuel and arms manufacturing are already two of the most heavily subsidized industries in the UK: the government provides an estimated £17.5 billion in annual subsidies to oil and gas production, while BAE Systems, the UK’s largest arms contractor, receives £1 billion in annual government science subsidies. Andrew Feinstein, a former South African ANC MP and founding director of Shadow World Investigations, calls this system “corporate welfarism,” where public money is privatized for corporate gain through state subsidies and no-bid contracts.
Feinstein notes that the arms trade accounts for an estimated 40% of all global corruption despite making up just 0.5% of total global trade, making it uniquely vulnerable to unethical profiteering. He points to evidence of brazen insider trading tied to the Iran war in the United States, including on prediction platform Polymarket, where former President Donald Trump’s son Donald Trump Jr. is an investor and sits on the advisory board. The *Financial Times* reports that more than $500 million in oil futures bets were placed just minutes before Trump announced a planned de-escalation with Iran, suggesting investors had advance insider knowledge of the announcement that allowed them to profit from market shifts.
“I have never seen war and conflict manipulated so nakedly for short-term profiteering… that is an element which is quite unique to the assault on Iran,” Feinstein said. “Wars are being partly fought to enable insiders to play the stock market and to profiteer in the short term on national security announcements. There is little attempt to hide it.”
The arms industry also benefits from built-in government secrecy, Feinstein explained. Though BAE Systems paid a $400 million fine for corrupt deals in 2010, the firm is still treated as an arm of the British state, and its executives receive extremely high levels of security clearance that give them unique access to sensitive government information and unparalleled policy influence. Anna Stavrianakis, an international relations professor at the University of Sussex, notes that while defense companies are privately owned, they receive massive taxpayer subsidies through government defense budgets, while all profits are kept private by corporate shareholders.
Campaign Against Arms Trade has described the relationship between private defense firms and Western governments as far more than a revolving door between public and private roles – it is an “open plan office,” reflecting the complete integration of industry interests into government policy. For example, Israeli weapons manufacturer Elbit Systems has directly interfered in UK democratic politics by meeting with the Home Office during the government’s crackdown on Palestine Action, a grassroots activist group that targets Elbit’s UK facilities. “There is a shared set of assumptions between industry and government that protest needs to be contained and that direct action needs to be repressed,” Stavrianakis said.
