The Albany Gazette - Shell refining margins reach record highs as wars hit supply

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Shell refining margins reach record highs as wars hit supply

ECONOMY 07.10.2026

Shell refining margins reach record highs as wars hit supply / Photo: Paul ELLIS - AFP/File

British energy giant Shell said Wednesday that its refining margins surged 75 percent in the third quarter compared with the second, as the Middle East and Ukraine wars hit supplies.

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These margins -- reflecting the spread between the price of crude oil and the fuels derived from it -- reached $42 per barrel in the July-September period, up from $24 per barrel between April and June, Shell said in a trading statement ahead of full third-quarter earnings.

At $42, the level is far above the previous record set in 2022 following the invasion of Ukraine by key energy producer Russia, according to Bloomberg.

Shell and other oil majors are seeing "an unprecedented widening of the refining spread", said Kathleen Brooks, research director at trading group XTB.

Fuel prices at the pump have surged in recent months, particularly for diesel, which is hitting record highs.

While crude oil volumes from the Middle East have recently risen, the production and export of refined products in the region remain heavily disrupted.

Logistical constraints have complicated re-routing of fuel supplies, widening the gap between crude oil prices and refined products.

At the same time, Ukrainian drone strikes on Russian energy infrastructure has prompted Russia -- a major player in the oil market -- to ban the export of certain products, notably gasoline and diesel.

Refineries unaffected by the conflict are thus benefiting from the tightening global supply of such products.

"If oil flows from the Middle East are disrupted once more, or if there are more attacks on refineries or more refineries shut down, refining margins could move higher," Brooks forecast.

Shell's share price was up 0.6 percent in London midday deals, outperforming the capital's benchmark FTSE 100 stocks index, which was down 0.6 percent.

(A.Moore--TAG)

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