Shell Plc announced one of its highest-ever share buybacks as the Iran war and the Russia-Ukraine conflict lead to record margins for its oil-refining business and surging profits.
The London-based major will repurchase $5 billion of shares in the fourth quarter, up from $3 billion previously, it said in an earnings statement on Thursday. Adjusted net income surged to $10.8 billion, the highest since the three months immediately after Russia’s full-scale invasion of Ukraine in early 2022, and above analysts’ expectations.
Big Oil is reaping an oil-refining bonanza because the two wars have temporarily halted a swath of the world’s fuel-making capacity, meaning out-sized profits for those plants that can continue churning out diesel, gasoline and other refined products.
The industry at large has so far distributed much its windfall profits to shareholders rather than chasing growth. For now, Shell’s buyback puts it on par with sector-leader ExxonMobil Holdings Corp., which plans $20 billion of repurchases this year. The US company reports earnings tomorrow. France’s TotalEnergies SE reported bumper profits on Thursday.
Shell shares rose as much as 3 percent in early trading in London.
The company’s refining margins surged to a record $42 a barrel in the quarter, up from $24 in the prior three months. Adjusted profit from Chemicals and Products, the segment including fuel-making and oil trading, jumped to $3.86 billion, the highest-ever quarterly earnings for Shell’s downstream unit. The same business made a total of $1.1 billion across all of 2025.
Shell said its refinery utilization would be between 92 percent and 100 percent of capacity in the final three months of this year. That compares with 102 percent and 96 percent, historically strong levels, in the second and third quarters respectively.
The major’s North American liquefied natural gas portfolio also benefitted from unusually wide profits for exporting the fuel into Europe and Asia following the ramp up of LNG Canada. Shell and its partners in the Canadian project agreed this quarter to double export capacity.
Shell’s profit surge underscores the value of an integrated business spanning production, refining, trading and shipping during periods of extreme market disruption.
Shell has spent years shrinking its refining footprint, but has increasingly integrated the plants it chose to retain within its vast trading operation.
That flexibility allows Shell to profit not only from a soaring gap between crude and refined fuel prices, but also from differences between products and regions. HSBC estimates Shell’s trading operations generated $6.6 billion of profit in the first half of 2026.
The downstream windfall more than offset the impact of disruption elsewhere in Shell’s portfolio, with production still impacted in Qatar, which represents about 10 percent of Shell’s overall oil and gas output.
Shell has pledged to distribute 40 percent to 50 percent of cash flow from operations to shareholders through the cycle. Earlier this year, the company previously reduced its quarterly buyback to $3 billion. It maintained its dividend.
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