Shell Restarts Pearl Partially as Hormuz Attacks Lift Crude and Refining Margins
Published on 10/09/2026 at 04:00 | Editorial boerse-global.de
Shell has begun bringing its Pearl gas-to-liquids complex in Ras Laffan, Qatar, partially back online, a company spokesperson confirmed. The move is designed to test production units and build limited product inventories, marking the first operational activity at the site since attacks damaged the facility in March.
The British energy major owns 100% of the site, which carries a nameplate capacity of 140,000 barrels of oil equivalent per day when running at full tilt. The complex houses two processing trains; while one is being restarted in stages, repair work continues on the second, with Shell expecting those works to wrap up in the first quarter of 2027.
Traders wasted little time reacting. QatarEnergy offered up to 50,000 tonnes of naphtha from Ras Laffan, including material sourced from Pearl, according to market participants. India's Haldia Petrochemicals separately locked in a contractual quarterly delivery of the same volume.
Shipping Risks Keep a Lid on Exports
Even with processing units humming again, getting finished product to customers remains fraught. Seaborne onward transport depends entirely on the security situation in the region and reliable passage through the Strait of Hormuz. Analysis firm Kpler reported that ten tankers were attacked in the strait last week. Alternative export routes via the Gulf of Oman and the Red Sea have taken root, but freight costs for sea transport remain extraordinarily elevated.
Shell CEO Wael Sawan said oil flows in the Middle East have reached roughly 80% of pre-war levels, though supply conditions remain tight.
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Crude Rally and Storm-Driven Cuts Add Fuel
The operational signals landed against a backdrop of sharply higher crude prices. Reuters reported that attacks on shipping in the Persian Gulf and the Strait of Hormuz pushed benchmarks upward, while approaching hurricanes in the Gulf of Mexico forced operators to throttle production there. In London trading, Shell shares at one point climbed 3.6%, according to Reuters.
The stock's advance has brought it back within touching distance of its prior highs. Shell ended the session up 3.2% at EUR 44.66, leaving it just 0.3% shy of its 52-week peak of EUR 44.80.
Q3 Guidance Points to a Sharper Upstream-Downstream Mix
The commodity tailwind is meeting improved operating prospects. Shell pre-released third-quarter metrics showing an indicative refining margin of $42/bbl, up sharply from $24/bbl in the second quarter. Reuters tied tighter fuel supplies stemming from the Middle East conflict directly to the widening refining spreads.
Integrated Gas is also perking up. Management raised its production forecast for the segment noticeably and expects LNG volumes of between 7.2 and 7.6 MT for the quarter, keeping liquefied natural gas as a central pillar of operations.
Not everything is pointing one way. Shell flagged an outflow of roughly $2.5 billion in the third quarter tied to the timing of payments for German emissions certificates under the Fuel Emissions Trading Act. Add to that exploration write-offs of about $0.3 billion and lower adjusted earnings in the marketing division.
Buybacks Continue Ahead of October Print
The company is pressing on with its share repurchase program. On Tuesday it bought 925,000 shares on the London exchange and 475,000 on XAMS as part of the existing cancellation program. Investors will get the full picture on October 29, 2026, when Shell publishes complete third-quarter results.
Analysts have been nudging their numbers higher. UBS's Joshua Stone kept a "Neutral" rating and a 3,750 pence price target but lifted his quarterly earnings estimates following the latest production signals. RBC maintained "Sector Perform" with a 4,000 pence target and modestly raised its forecast for adjusted operating cash flow before interest and working capital effects to $19.5 billion, underpinned by robust downstream refining margins.
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