Texas · TX Daily News
Shell has upgraded its outlook for gas production in the third quarter and said it expects profit margins from its refining operations to surge as the Iran war continues to disrupt global fuel supplies. The energy giant told investors it was forecasting integrated gas production to be between 740,000 and 780,000 barrels of oil equivalent per day (BOED) between July and September. This is higher than the 570,000 to 630,000 BOED range it was previously expecting.
Shell is also expecting a refining margin of 42 US dollars a barrel, a significant leap from the second quarter (Yui Mok/PA) (PA Archive) It would also mark an increase from the 631,000 BOED produced in the second quarter of 2026, which was impacted by the Middle East conflict damaging output from Qatar. The improved gas production outlook has been driven by its acquisition of Canadian energy firm ARC Resources, which completed in early September. Furthermore, Shell said it was expecting a refining margin of 42 US dollars a barrel for the third quarter for its chemicals and products division, which would mark a significant leap from the 24 dollars a barrel in the second quarter.
Refining margins show the difference between what it costs to turn crude oil into fuel and the price those fuels are then sold for. Shell and other energy companies have been running their plants at high levels of utilisation amid a shortage of refineries operating around the world. They have been producing fuels like diesel and jet fuel amid squeezed supplies globally.
Disruption to crude oil supplies through the Strait of Hormuz has pushed up wholesale prices since the conflict began at the end of February. The vital transit route carried about a fifth of the world’s oil and gas prior to the conflict. In the UK, average diesel prices reached £2 a litre for the first time ever last week, while petrol has also surged higher since the conflict.
Source: The Independent
