Shell posts $9.84bn Q2 profit as Middle East war drives market volatility

Royal Dutch Shell posted second-quarter profits of $9.84 billion, more than double the $4.26 billion it recorded in the same period last year, as the Middle East war created sharp swings in global energy markets.

Big headline, mixed underlying picture

Shell described the quarter as one of contrasts: revenue rose 45% year-on-year to $96.4 billion, supported by higher oil and gas prices, and cash flow from operations reached $21.4 billion, helped by a $3.4 billion working-capital inflow. The company also confirmed a further $3 billion share buyback and left its 2026 capital spending guidance unchanged at $24–26 billion.

Production hit by outages in Qatar

At the same time, Shell’s gas production fell sharply. The company reported gas output of 631,000 barrels of oil equivalent per day in the quarter, down from 909,000 barrels per day in the first three months of 2026. Shell attributed the decline to disruptions in Qatar, where its Pearl gas-to-liquids facility was struck by a missile in March and is not expected to be fully repaired for around a year, and to wider outages at the Ras Laffan LNG hub.

Across the first half of 2026, Shell’s total oil and gas production was down 16% compared with the same period in 2025, partly offset by new output from Brazil and the Gulf of America.

Trading and market swings drove earnings

With upstream output reduced, earnings in the quarter were driven more by trading. Since the conflict began, Brent crude swung from around $73 a barrel before the war to peaks above $120, then fell back below $100. The report notes that such price swings tend to widen the gap between buying and selling prices in commodity markets an environment in which trading operations can perform well.

Analyst Maurizio Carulli of Quilter Cheviot said:

“The standout contribution came from Shell’s trading operation, which once again demonstrated the value of its integrated business model, supported by healthy refining and chemicals performance and robust production growth in Brazil,”

adding that Shell “remains a steady ship in an industry where conditions can change rapidly.”

Shell chief executive Wael Sawan said:

“Operational performance enabled very strong results during another quarter of severe disruption in global energy markets.”

Industry-wide pattern

The IOL report noted that Shell was not alone: BP and Equinor had also reported strong profits this year on similar dynamics, and TotalEnergies saw its profits double in the same quarter. The article linked those results to elevated prices and heightened trading volatility stemming from the conflict.

Six-month performance

Combined with first-quarter profits of $6.92 billion, Shell’s first-half earnings for 2026 are up 70% on the same period last year.

Why the Strait of Hormuz mattered

The piece noted that roughly a fifth of the world’s oil passes through the Strait of Hormuz, a chokepoint that contributed to market pressure as traders assessed when, or whether, shipping through the strait might return to normal.