Shell (LSE:SHEL) has issued its outlook for the third quarter of 2026, forecasting higher refining margins alongside broadly stable upstream production and an expected increase in group net debt.
In integrated gas, production is expected to increase following the ARC Resources acquisition. Shell expects liquefied natural gas trading and optimisation results to be broadly in line with the second quarter.
Upstream production is also expected to remain broadly in line with the previous quarter. The segment is expected to include approximately $0.3 billion of exploration well write-offs.
Refining Margin Expected at Around $42 per Barrel
Within chemicals and products, Shell expects its indicative refining margin to increase to approximately $42 per barrel.
Chemicals margins are expected to decline, while low water levels on the Rhine are anticipated to affect utilisation at the Rheinland refinery.
Marketing volumes are expected to remain broadly stable compared with the second quarter, although Shell forecasts lower adjusted earnings from the business.
The quarter is also expected to include non-cash post-tax impairments relating to biogas assets. Shell said these would be largely offset at group level by an impairment reversal within integrated gas.
Renewables and energy solutions is expected to report adjusted earnings of between zero and $0.4 billion, while corporate adjusted earnings are forecast to remain negative within the company’s specified range.
Shell Forecasts Higher Net Debt
Shell expects cash flow from operations excluding working capital to include approximately $2.5 billion of outflows associated with the timing of German emissions certificate payments under the BEHG scheme.
The company expects the net effect of joint venture dividends to be broadly neutral during the quarter.
Net debt is forecast to increase compared with the previous quarter, reflecting the cash consideration and debt assumed through the ARC Resources acquisition.
Shell also expects net debt to be affected by higher variable components associated with long-term shipping leases under current macroeconomic conditions.
The company is due to provide its full third-quarter financial results later in October.
About Shell
Shell is a global energy company with operations spanning oil and natural gas production, liquefied natural gas, refining, chemicals, marketing and renewable and low-carbon energy activities.
The group also operates trading and shipping activities across its energy businesses and participates in a range of joint ventures and long-term contractual arrangements.
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