Business · Energy & Commodities · 4 hrs ago
Oil majors weigh spending plans as Iran war boosts expected profits
The US-Israeli war on Iran has disrupted shipping through the Strait of Hormuz since it began on February 28.
The disruption helped push energy prices to their highest levels in several years and created opportunities for oil companies' trading businesses.
Shell, BP and TotalEnergies expect refining margins in the third quarter to be three to four times higher than a year earlier, while Exxon says higher margins could add $4.5 billion to refining and marketing earnings compared with the previous quarter.
The major oil companies are expected to report much higher third-quarter profits, but investors want to know whether they will keep spending under control.
Chevron and Exxon have used cash to repay debt, while BP is expected to focus on strengthening its finances.
BP has suspended share buybacks this year and has said it plans to update its strategy on December 15.
Shell and TotalEnergies report on October 29, and BP, Chevron and Exxon on October 30, when investors can assess their plans for the cash.
The Iran war has boosted oil majors’ expected third-quarter profits, but companies are expected to keep spending under control.
Investors are watching whether the companies stick to their existing spending plans or use the windfall for expansion.
Exxon and Chevron have used cash to pay down debt, while BP is also prioritising its balance sheet.
Shell is expected to continue share buybacks, with a $3.5 billion programme forecast for the final quarter.
Shell and TotalEnergies are due to report results on October 29, followed by BP, Chevron and Exxon on October 30.
- Who
- Major oil companies including Shell, BP, TotalEnergies, Chevron and Exxon.
- What
- They are expected to report strong third-quarter profits as investors assess how they will use the extra cash.
- When
- Third-quarter results are due on October 29 and 30, 2026.
- Where
- The companies operate internationally; the war disrupted shipping through the Strait of Hormuz.
- Why
- The Iran war disrupted oil supply and shipping and increased energy prices, benefiting refining, trading and other businesses.
This story does not have two clearly opposing sides.
The United States and Israel launched the war on Iran, after which shipping through the Strait of Hormuz was severely disrupted.
Reuters reported that oil majors faced a test over how to use cash boosted by the war.
Shell and TotalEnergies are due to announce results.
BP, Chevron and Exxon are due to announce results.
- Shell share buyback
- $3.5 billion expected for the final quarter
- Shell refining margin
- Expected to reach a record $42 per barrel
- Exxon refining and marketing
- Higher refining margins could add $4.5 billion to earnings compared with the previous quarter
- BP net debt-to-operating cash ratio
- Expected to fall from 1.7 at the end of 2025 to 0.8 by the third quarter
- Results dates
- Shell and TotalEnergies: October 29; BP, Chevron and Exxon: October 30
3 sources
What people are saying
We believe the priority will remain firmly on debt reduction, with capital spending stable and no resumption of the share buyback programme before 2028