Globally, Shell said its jet fuel production was up 20% compared to the same quarter last year. (EPA Images pic)
LONDON: Shell Plc said its second-quarter (Q2) profit jumped on the back of an oil-refining boom and another robust period for energy trading as the Iran war upended the market.
Adjusted net income rose to US$9.8 billion, more than doubling earnings from the same period a year earlier, the London-based major said in a statement.
That marked the highest quarterly profit since 2022 and beat the US$8.7 billion average analyst estimate compiled by Bloomberg.
The company kept its US$3 billion quarterly share buyback and net debt fell.
The Iran war has given Shell and other oil giants a short-term financial fillip, with the rewards from trading and refining far outweighing any disruption they’ve suffered.
Having completed a multi-year period of cost-cutting, streamlining and prioritising shareholder returns, Shell CEO Wael Sawan now he needs to show he can replenish the company’s long-term reserves base.
The quarter was dominated by heightened volatility across global energy markets after fighting between the US and Iran disrupted oil and gas shipments through the Strait of Hormuz.
As well as lifting the majors, the war also boosted the world’s top commodity merchants.
Fuel prices have soared far above crude oil, boosting margins, and trading has given European majors an even bigger boost.
Shell ran its refineries hard in the period at a 102% utilisation rate, the highest level since at least 2022 when the company changed its methodology for the measurement to align more closely with industry disclosures.
Globally, Shell said its jet fuel production was up 20% compared to the same quarter last year.
Still, the conflict has also hurt Shell. Europe’s largest energy company reported a 31% production decline from its integrated gas division compared to the same quarter last year, driven by disruption in Qatar.
Shell is the world’s biggest LNG trader.
Sawan said on Bloomberg TV that reopening its Qatar plant was offline pending the ability to export product.