Key Moments
- Shell expects first-quarter 2026 working capital to fall between $10B and $15B due to extreme commodity price swings.
- Refining margins in the Chemicals and Products division rose to $17 per barrel from $14 in Q4 2025.
- Integrated Gas output is expected at 880,000–920,000 boe/d, reflecting the Middle East conflict impact on Qatari volumes.
Refining Margins Improve, Cash Flow Pressured
Shell reported that first-quarter 2026 refining margins rose to $17 per barrel, up from $14 in the previous quarter. However, the company warned that commodity price swings will trigger a large working capital outflow.
The expected working capital movement ranges from negative $10B to $15B. This swing comes from changes in inventory values and receivables caused by volatile prices.
Chemicals and Products Performance
Shell said that refining margins strengthened to $17 per barrel from $14 in Q4 2025. Chemicals margins stayed stable at $139 per tonne, compared with $140 per tonne last quarter.
| Segment / Metric | Q4 2025 | Q1 2026 (Guidance / Indicative) |
|---|---|---|
| Refining margins | $14 per barrel | $17 per barrel |
| Chemicals margins | $140 per tonne | $139 per tonne |
Integrated Gas Impacted by Middle East Conflict
Shell forecasts Integrated Gas production of 880,000–920,000 boe/d, down from 948,000 boe/d last quarter. The drop is due to the Middle East conflict affecting Qatari volumes.
LNG liquefaction is expected to reach 7.6–8 million tonnes, compared with 7.8 million tonnes in Q4 2025.
Upstream and Marketing Outlook
Upstream production is projected at 1.76–1.86 million boe/d, lower than 1.892 million boe/d last quarter. This includes the reduced output from the new Adura joint venture.
Marketing sales are forecast at 2.55–2.65 million barrels per day, versus 2.701 million last quarter. Despite lower volumes, adjusted earnings are expected to be higher than Q1 2025.
Utilization Rates Strengthen
Chemicals utilization should improve to 81–85%, up from 76% last quarter. Refinery utilization is projected at 95–99%, compared with 95% previously.
| Metric | Previous Quarter | Q1 2026 (Guidance) |
|---|---|---|
| Chemicals utilization | 76% | 81–85% |
| Refinery utilization | 95% | 95–99% |
Renewables, Corporate, and Group-Level Guidance
Shell expects adjusted earnings in Renewables and Energy Solutions of $0.2–0.7B, up from $0.1B in Q4. Trading & Optimisation is expected to perform much better than Q4 2025.
Corporate adjusted earnings are forecast at negative $1.0–0.8B, compared with negative $0.6B last quarter.
Tax paid across the group is expected to range from $2.0–2.8B, versus $2.6B previously. Derivative movements are projected between negative $1B and positive $4B.
Balance Sheet and Geopolitical Uncertainty
Non-cash net debt could rise $3–4B due to variable components of long-term shipping leases. Shell emphasized that its outlook faces increased uncertainty from the ongoing Middle East conflict.
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