Shell profits rocket above £5bn for three months amid surging oil prices due to Iran war
Shell announced that its profits in the first three months of 2026 increased at a rate that even exceeded analysts’ expectations, thanks to the rapidly increasing oil prices caused by the Iran war.
The oil giant reported underlying earnings of $6.92bn (£5.09bn), more than double the result in the previous three months and up 24% on a year ago. Most analysts expected the group to report profits of $6.36bn (£4.67bn).
But like rival BP, the company has come under attack from policy groups for profiting enormously from a conflict that will see UK households face huge bill increases on energy, food and transport throughout the year.
Shell said the rising cost of crude had boosted its oil trading business, with underlying earnings for its broader chemicals and products division more than quadrupling to $1.93bn (£1.41bn) from $449m (£330m) a year earlier.
The group also announced further returns to shareholders with $3bn (£2.2bn) in share buybacks and a 5 per cent increase in dividend payout for the next three months.
Wael Sawan, Chief Executive Officer, said: “Shell delivered strong results driven by our relentless focus on operational performance during a quarter of unprecedented disruption in global energy markets.
“The safety of our people remains our priority as we work closely with governments and our customers to meet their energy needs.”
But the company and others in the industry have faced criticism for profiting from conflicts in the Middle East. Tessa Khan, chief executive of climate change organization Uplift, said: “Global conflicts are driving up oil and gas prices again and again, and again and again ordinary households are paying the price.
“These profit announcements are just an unwelcome reminder of how the current energy system fares against ordinary people who are expected to continue to weather the economic shocks caused by our dependence on oil and gas.
“Clearly, the public is increasingly understanding the industry’s claims that more oil and gas production is in our interest. Instead of more drilling that will make profits for oil companies and executives, people want real solutions that will lower their bills and protect them from future crises.”
“This means investing in clean, home-grown energy and helping households transition from volatile oil and gas to clean electricity to power their lives through solar panels, heat pumps or electric vehicles.”
Commenting on the results, Derren Nathan, head of equity research at Hargreaves Lansdown, said Shell would continue to benefit in the medium term as even a peace resolution was unlikely to return global oil prices to $70 or less, where they were before the start of the Iran war.
“Shell’s first quarter underlying earnings were nearly $1 billion above forecasts amid unprecedented disruption in energy markets. Trading and optimization activities contributed strongly, but improved refining margins, cost discipline and higher prices also played a role,” he said.
“The outlook for integrated gas has been affected by the damage to Shell’s facilities in Qatar. The $16.4bn acquisition of ARC resources goes some way towards diversifying supply, but with net debt rising 27% to $52.6bn last year, management has slowed the pace of share buybacks somewhat. Overall, Shell is benefiting from the high energy price environment and we think it is unlikely that prices will return to pre-war levels, even if the Strait of Hormuz reopens.”
Rival BP also reported much better-than-expected results last week; First-quarter profits more than doubled to $3.2bn (£2.35bn) as its traders were able to take advantage of wildly volatile oil prices.
BP has been criticized by campaigners who accuse BP of making profits at the expense of households as fuel prices soar at the pumps and see energy bills set to rise further when the price cap is updated on 1 July.
Brent crude oil, jet fuel and gas prices rose after attacks in the region damaged production and the key Strait of Hormuz shipping corridor was severely disrupted.
The price of crude oil reached $126 a barrel last week, its highest level in four years, before falling back on peace deal hopes but still remaining above $100.
But Shell’s facilities have been disrupted, and in March the PearlGTL facility in Qatar halted production after it was hit during attacks. LNG facilities in the country, partly owned by Shell, were also affected.
Shell said it took no impairment charges in the first quarter despite “production cuts and export restrictions.”
The group also recently agreed a $16.4bn (£12.1bn) deal to buy Canadian energy company ARC Resources, which Mr Sawan said would “deliver value for decades to come”.
Additional reporting by PA
