The Zhitong Finance App learned that the oil trading business is expected to deliver strong results in the third quarter due to tightening global fuel supply driving refining profit margins to record highs.
The London-based energy giant said the oil deal was in line with strong results from the previous three months, thanks to a refining profit margin of $42 per barrel, which far surpassed the highest level of the quarter prior to 2022.
Due to the tightening of the global market due to the war in Iran and attacks on Russian refineries, Shell and its peers have been increasing refinery production capacity as much as possible, only stopping production for maintenance when absolutely necessary. Shell refiners' operating volume was only slightly lower than in the previous quarter, when their production capacity was already at full capacity. Shell's operating rate this quarter was only slightly lower than the previous quarter, when the refinery was in full operation.
This trading update gave the market a first glimpse into the performance of major oil companies during the turbulent quarter: the average price of Brent crude oil exceeded $90 per barrel during the quarter as the conflict in the Middle East continued. Supply disruptions have caused huge price misalignment across the energy market, driving a sharp rise in spot prices for crude oil and refined oil products.
Before releasing the full financial report on October 29, Shell said that the natural gas trading results for the quarter were also at the same level as the second quarter.