Shell reports sharp profit jump as Middle East conflict lifts oil and gas prices
Shell has reported a sharp rise in quarterly profit after the Middle East conflict pushed up oil and gas prices and disrupted global energy supplies. The company said adjusted profit for the July-to-September quarter reached $10.8bn, more than double the $5.432bn it made in the same period a year earlier. The results came as the company described the quarter as one marked by continued severe disruption to the global energy system.
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The figure beat analyst expectations of $10.33bn and was also higher than Shell's second-quarter profit of $9.836bn. The company said it would return $5bn to shareholders over the next three months through share buybacks, up from $3bn in the previous quarter. Shell chief executive Wael Sawan said the company's operational performance had delivered very strong results despite the disruption.
The profit increase was reflected in the market, with Shell shares rising by 3% in early trading. Climate campaigners criticised the windfall, arguing that fossil fuel companies were benefiting while households and communities faced higher costs and climate-related damage. Philip Evans, a senior campaigner at Greenpeace, said oil executives were profiting while people were paying with their lives and paychecks.
The results underline how the conflict in the Middle East is affecting energy markets well beyond the region. Shell said refinery margins climbed to $42 for each barrel of fuel produced in the quarter, far above the $24 a barrel seen in the previous quarter and above the earlier record of about $28 a barrel set during the early months of the Russia-Ukraine war. The company said shortages in the global market were being driven by severe damage to refineries in the Middle East and Russia.
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Shell also said its gas production had been hit by the crisis, after severe damage to one of its key gas processing facilities in the Gulf. The company's prewar gas output of 900,000 barrels of oil equivalent per day fell by a third as the war unfolded. That decline highlights the uneven impact of the conflict, which has boosted some parts of the business while constraining others.
What remains unclear is how long the current market conditions will last and whether further disruption will affect prices, refining margins or gas output in the coming months. Shell has already signalled that it expects strong returns to continue in the near term, but the wider energy outlook will depend on the course of the conflict and the extent of damage to infrastructure. Investors, regulators and campaigners are likely to keep watching whether the profit surge leads to more pressure over shareholder payouts and climate policy.
