Ampol profit surges nearly five-fold amid Middle East conflict

Ampol, Australia's largest transport fuel provider, reported a near five-fold surge in first-half net profit, propelled by elevated refining margins following the outbreak of the U.S.-Iran war and ongoing conflicts in the Middle East and Russia.

The company's net profit on a replacement cost basis—which excludes the impact of oil price changes on inventories—jumped to A$857.2 million for the six months ended June 30, up from A$180.2 million a year earlier. Statutory net profit for the half was even higher at A$1.4 billion, compared with a loss of A$25.3 million in the first half of 2025.

Ampol declared an interim dividend of 185 Australian cents per share, more than quadrupling the prior year's 40 cents.

Chief executive Matt Halliday attributed the result to the company's ability to navigate the market dislocation caused by the Middle East conflict.

"The first half of 2026 was marked by the Middle East conflict and the consequential impact on the flow of oil and refined products around the world," Halliday said in a statement on Monday.

"While the market dislocation provided a benefit to our financial results, our supply responsiveness, trading capabilities, refinery reliability, customer and supplier relationships, as well as the progress of our retail segmentation strategy, all enabled Ampol to meet its customers' needs."

Ampol runs one of Australia's two refineries, where profit margins more than tripled in the first half to $28.26 per barrel following the start of the U.S. war with Iran. Earnings from its fuel and infrastructure segment rose more than nine-fold, while its convenience retail business posted a 12% increase.

The underlying net profit after tax of A$857.2 million surpassed the Visible Alpha consensus estimate of A$840 million.

Market Context and Outlook

Crude oil prices have fluctuated wildly since the start of the year. In January, before the conflict began, oil hit a low of US$56 (A$78) per barrel, then soared to more than US$130 (A$181) in April—the highest level since the 2022 energy crisis. The Brent benchmark was trading at US$91.35 a barrel, up almost 25% from its pre-conflict price, but down from nearly US$120 in early March.

The surge in prices followed US-led attacks on Iran that sparked a regional conflict and effectively closed a key shipping route. Russia has also resorted to gasoline imports and imposed a diesel export ban after Ukrainian drone strikes hit its refining capacity.

Australian motorists were partially shielded from higher pump prices through a temporary fuel excise cut that initially took 32 cents off each litre, was reduced to 16 cents in July, and was fully reinstated from August 1. According to AMP, every US$10 per barrel increase in oil costs motorists about 10 cents per litre.

Looking ahead, Ampol said crude oil and energy product markets have remained volatile into the second half, but that this is helping regional refining margins. July 2026 earnings are ahead of the prior corresponding period, underpinned by strong refinery earnings.

Halliday said the company remains optimistic about its earnings potential, although the exceptional conditions of the first half may not persist.

"We are confident about our future earnings potential, with a number of tailwinds likely to persist, albeit not at the same levels as in the first half," he said.

"The overarching context is that oil product markets are expected to remain tight, as global refinery runs continue to be impacted by the ongoing conflicts in both the Middle East and Russia."

"We are not suggesting that the exceptional market conditions experienced in the first half represent a new normal. However, those market conditions do now appear tighter for longer."

Corporate Developments

Ampol completed its buyout of EG Group Australia at the end of the period. The divestment of more than 41 stations to Metro Petroleum is unlikely to be finalised until the end of 2026.

RBC Capital Markets analyst Gordon Ramsay said: "Overall, this result was driven by materially elevated Lytton refining margins, broad-based improvement across the fuel supply chain, and resilient convenience retail performance."

Ampol accounts for about 15-20% of Australia's total refined fuel needs.