Wael Sawan, Shell’s chief executive, attributed the results to operational strength during severe market disruption. The company worked to provide critical energy supplies to customers throughout the quarter, he said, as global markets grappled with supply constraints. Shell announced it would return $3 billion to shareholders through stock buybacks following the earnings release.

The profit surge triggered sharp criticism from environmental and social justice campaigners, who argued the windfall came at the expense of struggling households. Danny Gross, energy campaigner at Friends of the Earth UK, said the profits were built on an energy crisis that left households struggling with high energy bills at home and expensive fuel at pumps. He underlined the urgent need to end dependence on costly oil and gas.

Environmental Groups Condemn Windfall Earnings

Rudy Schulkind, political campaigner with Greenpeace UK, said the organization was running out of words to describe the obscenity of the numbers. Zack Polanski, leader of the UK Green Party, called the earnings obscene as the cost of living crisis continues to spiral with food and fuel prices soaring. The reaction reflected growing public anger over energy company profits amid widespread economic hardship.

An analysis released last month by environmental group 350.org estimated that over $700 billion will be siphoned from businesses and households to the oil and gas industry by the end of the year due to price increases caused by the war the US and Israel launched in late February. Oxfam projected earlier this week that the world’s six largest fossil fuel corporations-Shell among them-would double their combined profit in the second quarter of 2026.

The humanitarian group also found that emissions from BP, Chevron, ExxonMobil, Shell, and TotalEnergies were sufficient to cause around one in four heatwaves reported globally between 2000 and 2023. Those heatwaves would have occurred far less frequently without fossil fuel industry emissions, the research indicated.

UK Heat Deaths Surge as Temperatures Soar

Shell’s earnings announcement came as the UK faced a severe heatwave claiming thousands of lives. UK authorities said Thursday there were 2,877 heat-associated deaths in May and June, putting the country on track to see its highest level of heat-related deaths on record. The timing of the profit announcement against the backdrop of the deadly heat event intensified criticism of fossil fuel companies.

Climate campaigners drew direct connections between record industry profits, continued emissions, and the deadly consequences of rising global temperatures. The juxtaposition of massive corporate earnings and mounting climate casualties fueled calls for windfall taxes and accelerated transition away from fossil fuels. Critics argued the energy crisis exposed the vulnerability of economies dependent on volatile oil and gas markets.

UK Petrol Prices Reach Highest Point Since War Began

UK petrol prices climbed to their highest level since the beginning of the Iran war as the conflict continues to hit drivers’ finances. The average cost of petrol reached 160 pence per litre, according to motoring group the RAC. Diesel prices stood at 178.97 pence per litre, though still below the peak of 191.54p reached on April 15.

The price of fuel tends to track the wholesale price of oil, which surged when the Iran conflict began on February 28 as the fighting severely disrupted oil supplies across the Middle East. Prices nosedived when the US and Iran agreed to a framework deal to end the conflict in June, but they rose again since the collapse of peace talks. The volatility created uncertainty for consumers and businesses dependent on fuel.

Before the conflict, Brent crude traded at about $70 per barrel, but the fighting saw it peak above $120. In early July, after the framework deal was signed, prices fell back to near the $70 per barrel mark. When peace talks collapsed, the price climbed back up again to above $100 per barrel, but now trades around $90.

Oil Price Movements Drive Pump Cost Volatility

Analysts say every $10 per barrel increase in the oil price pushes up pump prices by roughly 7 pence per litre. Crude oil is a key ingredient in petrol and diesel, which means higher wholesale costs make filling up a car more expensive. Generally speaking, news of further conflict drives the price up while hopes of an end to the war pushes the price down.

Because transporting oil is a slow process, price movements in the wholesale markets take about a fortnight to show at the pump. Simon Williams, RAC head of policy, said the price of diesel was likely to reach 185 pence per litre in the next few weeks, barring any major oil price reduction. Fuel retailers have denied accusations of price gouging.

In early July, the RAC said the average price of petrol sank to a low of 150.59p per litre and 164.52p per litre for diesel. Since then the prices have risen steadily. Despite the conflict, petrol and diesel prices remain below the levels reached in the summer of 2022 following Russia’s invasion of Ukraine, when petrol reached 191.5p per litre and diesel hit 199p.

Energy Crisis Fuels Calls for Policy Reform

The combination of record fossil fuel profits and soaring consumer costs intensified demands for government intervention and accelerated clean energy transition. Critics argued that massive oil company earnings demonstrated the industry’s ability to absorb higher costs without passing them entirely to consumers. Environmental groups called for windfall taxes to fund renewable energy investments and support households struggling with energy bills.

The energy crisis exposed fundamental tensions between fossil fuel dependence, geopolitical volatility, and climate imperatives. As oil companies posted historic profits, millions of households faced difficult choices between heating, eating, and other essential expenses. The stark contrast between corporate windfalls and consumer hardship fueled growing pressure for structural reform of energy markets and taxation systems.

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The quarterly result represents Shell’s strongest performance since the second quarter of 2022, when the company reported earnings of $11.47 billion as oil and gas prices soared following Russia’s full-scale invasion of Ukraine. Shell reported adjusted earnings of $4.26 billion over the same period last year and $6.92 billion over the first three months of 2026. The first-half profits reached $16.75 billion, marking a 70% lift compared to the previous year.

CEO Wael Sawan addressed the results during an appearance on CNBC’s “Squawk Box Europe” on Thursday, emphasizing his company’s strategic approach to market turbulence. Volatility has become the defining characteristic of today’s energy markets, he acknowledged, but Shell has positioned itself to thrive amid uncertainty.

Operational Excellence Drives Performance Beyond Price Gains

“Volatility is the new normal. What we have been trying to build is a company that is able to thrive through volatility. So, you’re absolutely right, of course, the macro is such that the commodity prices are high and that provides a very strong tailwind for our results,” Sawan said.

The CEO highlighted two controllable factors that underpin Shell’s success beyond favorable commodity prices. First, the company demonstrated outstanding operational performance across every business segment, which created the foundation for the second critical element. That second factor centers on very strong trading and optimization capabilities, which allowed Shell to maximize value from volatile market conditions.

The company delivered $21.4 billion in cash flow from operations, supported by higher realized prices across its portfolio. Net debt declined significantly to $41.75 billion, down from $52.6 billion at the end of the first quarter. Shell maintained its capital expenditure outlook for 2026 unchanged at a range of $24 billion to $26 billion.

Shareholder Returns Continue at Steady Pace

Shell announced it would maintain the pace of its share buyback program at $3 billion over the next quarter, demonstrating confidence in its financial position and commitment to returning value to investors. London-listed shares of Shell rose 1.5% on Thursday morning following the announcement. The stock has jumped around 21% so far this year, although the company lags behind competitors including Britain’s BP and France’s TotalEnergies, as well as U.S. majors Exxon Mobil.

The bumper results arrive as energy majors across the globe receive a profit boost from soaring fossil fuel prices amid the Iran war. The United States launched its first airstrike in the Middle East on Wednesday since pausing its bombing campaign the previous week. U.S. Central Command described the strikes as a “powerful response” to Tuesday’s attempted Iranian attacks on American forces stationed in the Middle East region.

Middle East Conflict Creates Price Volatility and Supply Concerns

Oil and gas prices have experienced significant volatility amid disruption to production and deliveries from the Middle East since March. Brent crude oil currently trades at $91 a barrel, almost $20 higher than pre-war levels but well below the peak above $120 seen in April. UK gas costs for future delivery have climbed almost 70% higher than they were this time last year, threatening a further surge in household energy bills without a peace deal.

The on-off nature of hostilities has created persistent uncertainty in wholesale energy markets, though oil prices have received support from the release of international reserves. These strategic releases help offset the loss of supplies through the Strait of Hormuz shipping route, which typically handles a fifth of global shipments. The waterway off the Iranian coast also borders Oman and represents a critical chokepoint for global energy supplies.

Production Challenges and Strategic Reserve Concerns

Despite the profit surge, Shell faced operational headwinds including a 31% reduction in its gas production volumes. The decline stemmed from the loss of output following an Iranian attack on Shell’s assets at Qatar’s main liquefied natural gas facility in March. Shell’s finance chief signaled rising concern on Thursday over the erosion of strategic oil stockpiles, warning they were not “finite” resources.

Sinead Gorman suggested there may be “fewer levers to pull” in the months ahead as output increases elsewhere fail to compensate for the supply gap. The black hole in global supplies risks widening further as shipments from Saudi ports in the Red Sea come under attack from Houthi rebels operating in support of Iran. This additional disruption compounds existing supply chain challenges facing the global energy sector.

Political and Environmental Criticism Intensifies

The exceptional profit figures drew sharp criticism from environmental campaigners and political observers. Rudy Schulkind, political campaigner for Greenpeace, urged greater progress toward renewable energy transition while reacting to Shell’s earnings announcement.

“We’re running out of words to describe the obscenity of these numbers,” Schulkind said, as concerns mount over energy costs ahead of winter.

In the UK, rising energy costs present mounting concerns as winter approaches and fossil fuel firms continue focusing on maximizing shareholder value. Successive British governments have acknowledged that oil and gas will maintain a role in the country’s energy security for decades to come, despite rising investment in renewables such as wind and solar. These alternative energy sources play an increasing role within the national energy mix, though fossil fuels remain critical to meeting baseload demand.

Rival BP reports its quarterly progress next week and industry observers expect the company to reveal a similar profit trend driven by elevated commodity prices. The broader energy sector continues navigating the complex balance between meeting immediate energy security needs, delivering shareholder returns, and progressing toward longer-term decarbonization goals amid geopolitical turbulence.

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