By Adam Whittaker
Shell warned that a weak oil trading performance would drag on its earnings and narrowed guidance for its liquefied natural gas production.
The London-based energy giant Thursday said its fourth-quarter trading performance would be significantly lower than the prior quarter. While Shell's trading division oversees several liquids such as crude oil and diesel, trading in oil forms a significant potion of its activities.
Elsewhere, Shell narrowed its liquefied natural gas production guidance to between 7.5 million and 7.9 million metric tons for the quarter, from previous guidance of 7.4 million to 8 million tons.
The company also warned that adjusted earnings in its marketing division will be hit by seasonality and a non-cash deferred tax adjustment. At the same time, its chemicals and products segment is expected to report an adjusted earnings loss.
Analysts at UBS expect lower prices and higher costs to drag on European oil companies' earnings. Higher volumes and refining margins will offer some support, they said.
Shell said its refining margin marker rose to $14 a barrel, from $12 in the prior period.
Refining margins have recovered in recent quarters and saw spikes in October and November before normalizing at the end of the year. However, several oil majors had refineries under heavy maintenance which meant they were unable to capture the rise, RBC Capital Markets analysts wrote in a note to clients.
Meanwhile, Shell expects its upstream production--the extraction of crude oil and natural gas--to be between 1.84 million and 1.94 million barrels of oil equivalent a day. This compares with 1.83 million barrels of oil equivalent a day it produced in the third quarter.
Write to Adam Whittaker at adam.whittaker@wsj.com
(END) Dow Jones Newswires
January 08, 2026 02:58 ET (07:58 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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