SHEL

ExxonMobil (XOM) is up 40% in 2026 to $164.83, powered by Brent crude surging from the low $60s to $96, delivering $14.5B in Q2 earnings. Chevron (CVX) and the XLE ETF outpaced XOM with gains of 44% and 48% respectively, leaving the biggest U.S. major trailing its own sector. Reaching $200 is possible but depends on crude holding near $96, while the EIA projects Brent falling to $79 by 2027. Just released. Our analysts combed the entire stock market and named the ten best stocks to buy right now, and Exxon Mobil didn't make the cut. Enter your email to see the names that beat XOM. The report is free. Enter your email and see if any of your stocks made the cut. ExxonMobil (NYSE:XOM) stock is climbing Wednesday afternoon, extending a strong year for U.S. oil majors. ExxonMobil shares are up 3% in the current session to $164.83, carrying a 40% year-to-date gain. WTI crude oil has done much of the heavy lifting, and today it's up 3.29% over the past 24 hours to $96.09 per barrel. The question posed in the title is whether that momentum carries ExxonMobil stock to $200. That path exists, but it runs through crude prices rather than anything ExxonMobil directly controls. The rise of the WTI crude oil price reflects Middle East supply disruptions and tight product markets, and has a direct impact on energy majors' financials. BP (NYSE:BP) reported a Q2 refining indicator margin of $29.6 per barrel versus $11.9 a year ago, a spread that flowed into downstream results across the group. Free Report, Just Released Why Didn't XOM Make The Top 10 List? 24/7 Wall St has helped investors make money for over two decades, and our top analysts just finished ranking the definitive Top 10 Stocks To Buy Now. Not the ten biggest companies. Not the ten everyone is arguing about. The ten best stocks to buy right now. And XOM didn't make the cut! The report is free, and you can see why we think each stock is a top investment today. Enter Your Email and See the Ten → ExxonMobil's Q2 2026 results delivered $14.5 billion in earnings, more than $17 billion of free cash flow, and a more than $7 billion reduction in net debt. Guyana production ran at roughly 900,000 barrels per day, and Permian output hit a record 1.8 million oil-equivalent barrels per day. The company's cumulative structural cost savings reached $16.3 billion since 2019, part of a $20 billion target by 2030. Chevron (NYSE:CVX) stock has gained 44% year to date, outpacing ExxonMobil. Meanwhile, the Energy Select Sector SPDR ETF (NYSEARCA:XLE) has advanced 48% year to date to $65.39. ExxonMobil is the XLE ETF's largest position at 22.7% of net assets, so the rest of the energy complex has run harder than the biggest U.S. major. The European ADRs land lower on the leaderboard. Shell (NYSE:SHEL) stock has climbed 33% year to date. Additionally, BP stock has risen 35% year to date, leaving ExxonMobil ahead of both and confirming that the ranking depends entirely on the comparison chosen. Getting ExxonMobil stock to $200 likely requires WTI crude oil to hold near its current levels and refining spreads to stay wide. With the oil price already up in recent sessions, the fade risk shouldn't be overlooked. ExxonMobil's own contribution is real but incremental. Guyana is transitioning from investment recovery to free cash flow, with management guiding to twice the 2025 level by 2030. A 2026 buyback plan of $20 billion, with $4.9 billion already completed in Q1, provides a per-share tailwind even if crude softens. The next WTI crude oil price move and any change in Middle East shipping conditions could matter just as much as the next ExxonMobil filing. Investors may want to keep an eye on whether the oil price holds above the mid-$90s into the fourth quarter, with refining cracks likely to stay wide as European capacity remains constrained. The $200 level implied by the title is achievable, but it depends on macro conditions rather than company execution. Position sizing in ExxonMobil stock should reflect that this is a commodity-price story wrapped around a well-run operator, and their exposure should scale accordingly. If you have cash sitting in your account right now, give this two minutes. After more than two decades of helping investors beat the market, our top analysts at 24/7 Wall St. put together a definitive report on the Top 10 Stocks To Buy Today. And XOM wasn't one of them. They combed the entire market. It's not 10 ideas, not 10 stocks everyone is talking about, it's what their research points to as the 10 best stocks to buy right now, and it's free. Read more here and >;elm:context_link;itc:0;sec:content-canvas" data-yga="{"yLinkElement":"context_link","yModuleName":"content-canvas","yLinkText":"see which stocks made the list -->"}" class="link ">see which stocks made the list -->> Contact [email protected] for any questions or corrections.

SHELL PLC SECOND QUARTER 2026 EURO AND GBP EQUIVALENT DIVIDEND PAYMENTS September 7, 2026 The Board of Shell plc today announced the pounds sterling and euro equivalent dividend payments in respect of the second quarter 2026 interim dividend, which was announced on July 30, 2026 at US$0.3906 per ordinary share. Shareholders have been able to elect to receive their dividends in US dollars, euros or pounds sterling. Holders of ordinary shares who have validly submitted US dollars, euros or pounds sterling currency elections by August 28, 2026 will be entitled to a dividend of US$0.3906, €0.3366 or 28.92p per ordinary share, respectively. Absent any valid election to the contrary, persons holding their ordinary shares through Euroclear Nederland will receive their dividends in euros at the euro rate per ordinary share shown above. Absent any valid election to the contrary, shareholders (both holding in certificated and uncertificated form (CREST members)) and persons holding their shares through the Shell Corporate Nominee will receive their dividends in pounds sterling, at the pound sterling rate per ordinary share shown above. Euro and pounds sterling dividends payable in cash have been converted from US dollars based on an average of market exchange rates over the three dealing days from September 2 to September 4, 2026. This dividend will be payable on September 21, 2026 to those members whose names were on the Register of Members on August 14, 2026. Taxation - cash dividend If you are uncertain as to the tax treatment of any dividends you should consult your tax advisor. Note A different currency election date may apply to shareholders holding shares in a securities account with a bank or financial institution ultimately holding through Euroclear Nederland. This may also apply to other shareholders who do not hold their shares either directly on the Register of Members or in the corporate sponsored nominee arrangement. Shareholders can contact their broker, financial intermediary, bank or financial institution for the election deadline that applies. Enquiries Media: International +44 (0) 207 934 5550; U.S. and Canada: https://www.shell.us/about-us/news-and-insights/media/submit-an-inquiry.html CAUTIONARY NOTE The companies in which Shell plc directly and indirectly owns investments are separate legal entities. In this announcement “Shell”, “Shell Group” and “Group” are sometimes used for convenience to reference Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this announcement refer to entities over which Shell plc either directly or indirectly has control. The terms “joint venture”, “joint operations”, “joint arrangements”, and “associates” may also be used to refer to a commercial arrangement in which Shell has a direct or indirect ownership interest with one or more parties. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest. Forward-Looking statementsThis announcement contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions, including (without limitation) those concerning Shell’s strategy and operating plans, macroeconomic conditions, future energy demand, supply and product mix, commodity prices, demand for Shell’s products, production results and reserve estimates, development, execution and management of projects, energy transition and climate change, management of safety and environmental risks, costs, cash capital expenditures, technology advancements, legislative, judicial, fiscal and regulatory developments, regional conflicts and trading conditions, and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”; “ambition”; ‘‘anticipate’’; “aspire”, “aspiration”, ‘‘believe’’; “commit”; “commitment”; ‘‘could’’; “desire”; ‘‘estimate’’; ‘‘expect’’; ‘‘goals’’; ‘‘intend’’; ‘‘may’’; “milestones”; ‘‘objectives’’; ‘‘outlook’’; ‘‘plan’’; ‘‘probably’’; ‘‘project’’; ‘‘risks’’; “schedule”; ‘‘seek’’; ‘‘should’’; ‘‘target’’; “vision”; ‘‘will’’; “would” and similar terms and phrases. There are a number of factors that could affect the future operations of Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this announcement, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks, including climate change; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, judicial, fiscal and regulatory developments including tariffs and regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; (m) risks associated with the impact of pandemics, regional conflicts, such as the Russia-Ukraine war and the conflict in the Middle East, and a significant cyber security, data privacy or IT incident; (n) the pace of the energy transition; and (o) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this announcement are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in Shell plc’s Form 20-F for the year ended December 31, 2025 (available at www.shell.com/investors/news-and-filings/sec-filings.html and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this announcement and should be considered by the reader. Each forward-looking statement speaks only as of the date of this announcement, September 7, 2026. Neither Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this announcement. Shell’s net carbon intensity and net-zero emissions targetIn this announcement we may refer to Shell’s “net carbon intensity” (NCI), which includes Shell’s carbon emissions from the production of our energy products, our suppliers’ carbon emissions in supplying energy for that production and our customers’ carbon emissions associated with their use of the energy products we sell. Shell’s NCI also includes the emissions associated with the production and use of energy products produced by others which Shell purchases for resale. Shell only controls its own emissions. The use of the terms Shell’s “net carbon intensity” or NCI is for convenience only and not intended to suggest these emissions are those of Shell plc or its subsidiaries. Shell’s operating plan and outlook are forecasted for a three-year period and ten-year period, respectively, and are updated every year. They reflect the current economic environment and what we can reasonably expect to see over the next three and ten years. Accordingly, the outlook reflects our combined Scope 1 and 2 target, NCI target and our oil products ambition over the next ten years. However, Shell’s operating plan and outlook cannot reflect our 2050 net-zero emissions target, as this target is outside our planning period. Such future operating plans and outlooks could include changes to our portfolio, efficiency improvements and the use of carbon capture and storage and carbon credits. In the future, as society moves towards net-zero emissions, we expect Shell’s operating plans and outlooks to reflect this movement. However, if society is not net zero in 2050, as of today, there would be significant risk that Shell may not meet this target. The information provided above regarding Shell’s NCI and net zero emissions target are not intended, nor should they be construed as introducing, suggesting or making any claim, target or representation thereof other than what is included in the announcement. Forward-Looking non-GAAP measuresThis announcement may contain certain forward-looking non-GAAP measures such as free cash flow and underlying operating expenses. We are unable to provide a reconciliation of these forward-looking non-GAAP measures to the most comparable GAAP financial measures because certain information needed to reconcile those non-GAAP measures to the most comparable GAAP financial measures is dependent on future events some of which are outside the control of Shell, such as oil and gas prices, interest rates and exchange rates. Moreover, estimating such GAAP measures with the required precision necessary to provide a meaningful reconciliation is extremely difficult and could not be accomplished without unreasonable effort. Non-GAAP measures in respect of future periods which cannot be reconciled to the most comparable GAAP financial measure are calculated in a manner which is consistent with the accounting policies applied in Shell plc’s consolidated financial statements. These forward-looking non-GAAP measures are provided to assist readers in understanding management’s use and expectations of such measures and may not be appropriate for other purposes. The contents of websites referred to in this announcement do not form part of this announcement. We may have used certain terms, such as resources, in this announcement that the United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

ExxonMobil Holdings Corporation XOM paired sharply higher second-quarter revenues with record production marks, but adjusted earnings still missed expectations. The mix shows how volume growth and tighter product markets can lift results while costs and regional disruption remain material earnings variables. Advantaged Permian and Guyana assets support future volumes and cash generation. Refining, chemicals and Middle East exposure, however, leave results sensitive to market conditions outside the company’s control. Adjusted earnings of $3.52 per share missed the Zacks Consensus Estimate of $3.68 by 4.3%. Revenues of $116 billion beat the consensus mark by 21.1% and increased 42.3% year over year. Higher scheduled-maintenance expenses and increased depreciation weighed on earnings, while Middle East conditions disrupted production. The revenue beat therefore did not fully offset operating and cost pressures. Upstream production totaled 4.514 million oil-equivalent barrels per day in the second quarter. ExxonMobil’s broader plan shows production rising from 4.3 million oil-equivalent barrels per day (Moebd) in 2024 to 4.6 million year to date in 2026 and about 5.5 million by 2030. Advantaged assets increased from 52% of upstream production in 2024 to 59% year to date in 2026 and are planned at about 65% by 2030. Image Source: ExxonMobil Holdings Corporation Permian output exceeded a record 1.8 million oil-equivalent barrels per day, with management targeting a 9% production compound annual growth rate through 2030. The fifth Guyana floating production, storage and offloading vessel is slated to start in the fourth quarter, adding 250,000 barrels per day of capacity. Chevron Corporation CVX also reported record U.S. upstream production of nearly 2.1 million oil-equivalent barrels per day in the second quarter. Energy Products generated $4.10 billion of adjusted earnings as stronger refining conditions, optimization and structural savings supported results. Chemical Products adjusted earnings rose to $1.21 billion from $110 million in the first quarter. The sequential gains also highlight cyclicality. Refining and chemical earnings remain exposed to margins, feedstock costs, trading results and supply conditions, leaving room for sharp swings as markets change. Middle East assets represent about 20% of ExxonMobil’s global oil-equivalent production. The conflict temporarily removed about 10% of total upstream production during the second quarter, making regional conditions an important near-term volume variable. A full-quarter Strait of Hormuz closure in the third quarter could reduce Middle East production by about 750,000 oil-equivalent barrels per day versus 2025. Shell plc SHEL reported Integrated Gas production of 631,000 oil-equivalent barrels per day in the second quarter, down from 909,000 in the first quarter as Qatar-related disruptions reduced volumes. ExxonMobil generated $17.2 billion of free cash flow while cash capital expenditures totaled $6.8 billion in the second quarter. That capacity supports continued investment in the Permian, Guyana and liquefied natural gas projects through volatile conditions. Shareholder distributions reached $9.4 billion, including $4.3 billion of dividends and $5.1 billion of share repurchases. Net debt fell by more than $7 billion during the quarter, preserving financial flexibility for growth and capital returns. ExxonMobil exits the quarter with a clear trade-off. Advantaged production growth and stronger Product Solutions earnings support cash generation, but commodity sensitivity and Middle East disruption can still reduce earnings visibility. The stock currently carries a Zacks Rank #3 (Hold), which points to a neutral short-term stance. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Its Value Score of A, Growth Score of A, Momentum Score of A and VGM Score of A indicate favorable characteristics across all three styles, but the Style Scores complement rather than override the Zacks Rank. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ExxonMobil Holdings Corporation (XOM) : Free Stock Analysis Report Chevron Corporation (CVX) : Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Chevron Corporation CVX has entered the second half of 2026 with considerable operating momentum. The company recently delivered an impressive quarterly beat, reporting adjusted earnings of $12 billion for the second quarter of 2026. The strong performance was supported by solid operational execution, higher crude oil price realizations, robust refining margins and increased production following the Hess acquisition. Results were further underpinned by stronger cash flow, a resilient upstream portfolio and disciplined shareholder returns. Yet with shares lagging both ExxonMobil XOM and Shell SHEL, and valuation sitting at a premium, the bigger question is whether this momentum can translate into meaningful upside for investors. Chevron’s second-quarter operating performance was impressive. Worldwide net oil-equivalent production reached 4.07 million barrels per day, up 20% year over year, driven largely by legacy Hess assets and growth in the Permian Basin and Gulf of America. U.S. production reached a record 2.07 million barrels of oil equivalent per day. Refining operations were similarly strong, with U.S. crude unit throughput reaching a record 1.07 million barrels per day and utilization exceeding 97%. Higher commodity prices amplified those operating gains. Chevron reported second-quarter earnings of $12.1 billion, or $6.11 per share, while adjusted earnings totaled roughly $12 billion, or $6.06 per share. Cash flow from operations excluding working capital was $19.7 billion, while adjusted free cash flow reached $15.4 billion. That cash generation has provided significant financial flexibility. Chevron reduced debt by a record $8.4 billion during the quarter, while its net debt-to-CFFO ratio improved to 0.6X. At the same time, the company continued returning capital, paying $3.5 billion of dividends and repurchasing $3 billion of shares during the quarter. Image Source: Chevron Corporation The Hess acquisition is also showing tangible benefits. One year after closing, Chevron had captured $1.5 billion of annual run-rate synergies — 50% above its initial target and six months ahead of schedule. Management said the acquired assets are generating free cash flow at roughly twice the incremental dividend burden, while Guyana provides exposure to high-margin production growth extending into the 2030s. Cost discipline offers another lever. Chevron achieved $3 billion of annual run-rate structural cost reductions six months early, with more than 70% of the savings stemming from efficiency improvements. Meanwhile, management expects 2026 shale and tight capital spending per barrel of oil equivalent to be 25% below last year, indicating that production growth is becoming more capital efficient. Chevron is also broadening its opportunity set beyond conventional oil and gas. Project Kilby in West Texas includes a 20-year take-or-pay agreement to supply Microsoft with 2.67 gigawatts of behind-the-meter power. Management expects the project to generate mid-teens returns and long-duration cash flows that are less correlated with commodity cycles, although the project remains subject to final investment decision and execution. Commodity exposure remains the biggest swing factor. Chevron estimates that every $1 change in Brent affects full-year after-tax earnings and cash flow by roughly $600 million. Second-quarter Brent averaged nearly $104 per barrel, providing a substantial earnings tailwind that may not persist. Image Source: Chevron Corporation Near-term operations also face maintenance headwinds. Chevron expects third-quarter upstream turnarounds and downtime to reduce production by 150,000-200,000 barrels of oil equivalent per day, while downstream maintenance could reduce after-tax earnings by $175-$225 million. Geopolitical exposure, particularly around Kazakhstan’s CPC export route and the Middle East, adds another layer of uncertainty. The company itself identifies commodity prices, OPEC+ actions, geopolitical conflicts and operational disruptions among material risks. Chevron’s shares have gained 1% over the past three months compared with the sub-industry’s 0.3% growth. However, the company underperformed its peers, as ExxonMobil and Shell have risen 2.2% and 3.7%, respectively, during the same time period. Image Source: Zacks Investment Research Chevron’s premium valuation also leaves less room for error. The stock trades at roughly a 12.61X forward price-to-earnings multiple, notably higher than Shell’s 9.44X but below ExxonMobil’s 13.32X. Image Source: Zacks Investment Research Chevron’s underlying picture is constructive: record production, accelerating Hess synergies, structural cost reductions, robust cash generation and a stronger balance sheet provide a solid foundation. The Microsoft power agreement also introduces an intriguing source of contracted, commodity-diversified growth. However, elevated commodity sensitivity and upcoming maintenance could create earnings volatility after an exceptionally strong second quarter. For now, Chevron, currently carrying a Zacks Rank #3 (Hold), appears well positioned operationally, but investors may want clearer evidence that recent earnings strength can endure through a less supportive commodity environment before taking a more bullish stance. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Chevron Corporation (CVX) : Free Stock Analysis Report ExxonMobil Holdings Corporation (XOM) : Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Europe’s largest oil company, Shell plc SHEL, reported second-quarter 2026 earnings per ADS of $3.52 (on a current cost of supplies basis, excluding items — the market’s preferred measure), which beat the Zacks Consensus Estimate of $3.23. The bottom line also increased from the year-ago adjusted profit of $1.42, reflecting strong operational performance across all its segments, driven by higher realized prices and higher margins. Shell’s revenues of $96.3 billion were significantly up from $66.4 billion in second-quarter 2025 but missed the consensus mark by 4.2%. Shell PLC Unsponsored ADR price-consensus-eps-surprise-chart | Shell PLC Unsponsored ADR Quote Shell returned $5.2 billion to its shareholders in the quarter, including $2.2 billion in cash dividends and $3 billion in share repurchases. However, its planned $3 billion buyback program was temporarily paused following the agreement to acquire ARC Resources Ltd., with only $1.8 billion completed. The company has now launched a new buyback program totaling $4.2 billion, comprising $3 billion in fresh repurchases and the remaining $1.2 billion from the earlier program, targeted for completion by the third-quarter 2026 results announcement. Upstream: The segment recorded a profit of $3.5 billion (excluding items) during the quarter, up from $1.7 billion (adjusted) in the year-ago period. This primarily reflects the impact of higher realized prices and margins. At $89 per barrel, the group’s worldwide realized liquids prices were 39% above the year-earlier levels and natural gas prices increased 20.3%. Shell’s upstream volumes averaged 1,824 thousand oil-equivalent barrels per day (MBOE/d), up 5.3% from the year-ago period, backed by new oil production in Brazil and the Gulf of America. Liquids production totaled 1,367 thousand barrels per day (an increase of 2.5% year over year), and natural gas output came in at 2,648 million standard cubic feet per day (up 14.5%). Chemicals and Products: In this segment, the London-based supermajor reported an adjusted profit of $2.9 billion, increasing significantly from an adjusted profit of $118 million in the year-ago period. The favorable comparison reflected higher chemicals and products margins, which in turn were mainly driven by higher trading and optimization. Meanwhile, refinery utilization came in at 102%. Integrated Gas: The unit reported an adjusted income of $2.7 billion, increasing from $1.7 billion in the second quarter of 2025. Results were mainly driven by the combined effect of higher contributions from trading and optimization and higher realized prices. The realized liquids price in this segment increased 33.3% from the year-ago quarter. Marketing: The segment recorded an income of $1.3 billion (excluding items) during the quarter compared to the year-ago earnings of $1.2 billion, backed by higher Mobility unit margins and favorable tax movements. Renewables and Energy Solutions: The segment reported an adjusted income of $79 million, turning around from the year-ago loss of $9 million. The performance boost primarily reflects contributions from trading and optimization, and energy marketing. External power sales were flat year over year to 70 terawatt hours, while piped gas sales edged up to 161 terawatt hours. As of June 30, 2026, the Zacks Rank #3 (Hold) company had $31.4 billion in cash and $73 billion in debt (including short-term debt). Net debt-to-capitalization was approximately 18.7%, down from 19.1% a year ago. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. During the quarter under review, Shell generated cash flow from operations of $21.4 billion, returned $2.2 billion to its shareholders through dividends and spent $4.2 billion in cash on capital projects. The company’s cash flow from operations increased significantly by 79.5% from the year-earlier level. Meanwhile, the group raked in $17.5 billion in free cash flow during the second quarter compared to $6.5 billion a year ago. Shell expects full-year 2026 cash capital expenditure to increase to $24-$26 billion from $21 billion in 2025, reflecting continued investment across its portfolio. For the third quarter of 2026, Integrated Gas production is projected at 570-630 thousand barrels of oil equivalent per day (boe/d), while LNG liquefaction volumes are anticipated to range between 7.1 million and 7.7 million tons. These forecasts exclude contributions from ARC Resources Ltd. and Qatar. Upstream production is expected to be between 1,680 thousand and 1,880 thousand boe/d, with higher planned maintenance activities across the portfolio weighing on output. Marketing sales volumes are projected at 2,550-2,750 thousand barrels per day, while refinery utilization is expected to remain strong at 93%-101%. Chemicals manufacturing plant utilization is forecast at 78%-86%. Additionally, Corporate Adjusted Earnings, which reflected a net expense of $617 million in the second quarter of 2026, are expected to remain a net expense of approximately $500-$700 million in the third quarter. While we have discussed Shell’s second-quarter results in detail, let’s take a look at some other Big Oil energy reports of this season. American multinational ExxonMobil Holdings Corporation XOM reported second-quarter 2026 adjusted earnings of $3.52, missing the Zacks Consensus Estimate of $3.68 by 4.3%. Revenues of $116 billion topped the consensus estimate of $95.8 billion by 21.1%. Adjusted earnings increased from $1.61 in the year-ago quarter, while revenues rose 42.3% year over year from $81.5 billion. The lower-than-expected quarterly earnings can be attributed to higher expenses due to scheduled maintenance activities and increased depreciation tied to recent investments. The company faced production disruptions related to Middle East conditions. The company ended the quarter with cash and cash equivalents of $10.6 billion and long-term debt of $32.2 billion. ExxonMobil also reduced net debt by more than $7 billion during the second quarter, improving its net debt-to-capital ratio to 11%. Smaller rival Chevron CVX reported second-quarter 2026 adjusted earnings of $6.06 per share, which beat the Zacks Consensus Estimate of $5.80 by 4.5%. The outperformance was driven by higher commodity prices, increased upstream production following the Hess acquisition, stronger refined-product margins and higher sales volumes. The company generated revenues of $70.06 billion. The metric beat the Zacks Consensus Estimate of $57.53 billion and increased 56.3% year over year.  The increase was primarily driven by a 51.4% year-over-year increase in sales and other operating revenues, along with a 296.5% rise in income from equity affiliates. As of June 30, 2026, the only energy component of the Dow Jones Industrial Average had $8.53 billion in cash and cash equivalents and total debt of $37.1 billion, with a debt-to-total capitalization of about 16.3%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report Chevron Corporation (CVX) : Free Stock Analysis Report ExxonMobil Holdings Corporation (XOM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Equinor ASA EQNR shares have gained 22.2% in the past month, putting the rally’s durability at center stage. The advance has coincided with a sharp earnings rebound, higher production and stronger trading contributions. The operating recovery is meaningful, but expectations have also risen. A valuation above historical and sub-industry levels, together with lower 2027 consensus estimates, leaves less room for commodity, execution or cash-flow setbacks. Second-quarter 2026 adjusted earnings reached $1.33 per share, up 107.8% from 64 cents a year earlier. Revenues increased 40% to $35.18 billion, while adjusted operating income rose 76% to $11.48 billion. The quarter was not flawless. Earnings missed the Zacks Consensus Estimate, although revenues edged past the consensus mark. Higher liquids and European gas prices, production growth and trading performance still provided broad support for the year-over-year improvement. Equity oil and gas production rose 3% to 2,165 thousand barrels of oil equivalent per day. Norwegian Continental Shelf output increased 4%, helped by new fields, new wells and better-than-planned performance from Johan Sverdrup. First-half production increased 6%, making Equinor’s roughly 3% full-year growth guidance more dependable. Planned third-quarter turnarounds and the temporary Johan Castberg outage remain offsets, but management retained its 2026 outlook. Marketing, Midstream & Processing generated $777 million in adjusted operating income, up from $337 million a year earlier and well above normal-quarter guidance of about $400 million. Crude trading, shipping optimization, refining and liquefied natural gas trading all contributed. Shell plc SHEL also cited broad operational strength across its businesses in second-quarter 2026. BP p.l.c. BP reported stronger refining and customer results, showing why integrated portfolios can supplement upstream earnings when market conditions shift. EQNR trades at 9.4X forward 12-month earnings, above its five-year median of 7.7X and the Zacks sub-industry’s 9.3X. The premium is modest against the peer group but wider against Equinor’s own trading history. That setup narrows the cushion if commodity prices weaken, trading results normalize or projects slip. The recent share-price move therefore places more weight on continued operating delivery rather than valuation expansion alone. The Zacks Consensus Estimate points to 2027 earnings of $3.75 per share, down from $4.93 in 2026. Consensus sales are projected to decline to $105.13 billion from $120.28 billion. Growth normalization could make safety, tax timing and project execution more influential. Serious incident frequency remained above the 2025 level, Norwegian tax installments can make quarterly cash conversion uneven and the larger project pipeline raises delivery demands. Image Source: Zacks Investment Research The bottom line is balanced. Equinor’s earnings, production and trading results support the recent recovery, but valuation and lower 2027 estimates reduce the margin for disappointment after a 22.2% monthly gain. EQNR currently carries a Zacks Rank #3 (Hold). Its Value Score of A, Growth Score of A, Momentum Score of B and VGM Score of A are favorable, but Style Scores complement the Zacks Rank rather than replace it. The combination supports holding interest more than chasing the rally without further estimate-revision confirmation. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Equinor ASA (EQNR) : Free Stock Analysis Report BP p.l.c. (BP) : Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

BP reported second-quarter net profit of $3.91 billion on Tuesday, more than double the $1.62 billion it posted in the same period last year, as the U.S.-Iran war drove oil and gas prices sharply higher. A core profit measure that strips out certain items came in at $5.7 billion for the April-to-June period, the company said. Analyst expectations for that figure stood at $5 billion, according to CNBC. Total revenue climbed 47% to $70 billion compared with a year earlier. The results reflect conditions that have upended global energy markets. Fighting between Washington and Tehran has severely disrupted shipping through the Strait of Hormuz, a narrow waterway that handles around a fifth of the world's oil and natural gas. Together, the five major Western oil companies — BP, Chevron, ExxonMobil, Shell and TotalEnergies — earned close to $47 billion in combined net profit during the quarter, according to Euronews. BP chief executive Meg O'Neill, who has led the company since April, said in a statement that the quarter occurred during "one of the most disrupted periods in the global energy market." "We are not making the most of our potential," O'Neill added. "Our performance over the past few years has not met our own expectations, let alone those of our shareholders." O'Neill addressed President Donald Trump's criticism of oil companies over high fuel prices. "I understand the pressure that the ordinary household feels when they pull into the service station to fill up and see the prices," O'Neill told CNBC's "Squawk Box Europe." "The reality is we produce a global commodity and the prices for the product we sell hangs off that global commodity price." Trump on Monday called out Exxon Mobil and Chevron for making "too much money" off higher fuel prices. The company reported quarterly operating cash flow of $10.9 billion, while net debt dropped to $22.25 billion by quarter's end, compared with $25.3 billion three months earlier, the company said. BP raised its quarterly dividend by 4% to 8.66 cents per ordinary share. Oil prices posted their biggest monthly gain since March in July, with Brent crude rising roughly 20% as the conflict escalated and disruptions spread across key shipping routes. The International Energy Agency has forecast that global supply will fall by 3.9 million barrels per day in 2026, with the war estimated to have blocked more than 14 million barrels per day of Middle East output. BP announced Tuesday that it is moving to divest Archaea Energy, a U.S. biogas unit it purchased for $4.1 billion in 2022. The company also said it had completed the sale of its Gelsenkirchen refinery in Germany and plans to sell its North Sea business. BP stock climbed 0.8% on Tuesday.

Image source: The Motley Fool. Thursday, July 30, 2026 at 9:30 a.m. ET Chief Executive Officer - Wael Sawan Chief Financial Officer - Sinead Gorman Operator: Welcome to Shell's Second Quarter 2026 Financial Results Announcement. Shell's CEO, Wael Sawan; and CFO, Sinead Gorman, will present the results, then host a Q&A session. [Operator Instructions] We will now begin the presentation. Wael Sawan: Welcome, everyone, and thank you for joining. Today, Sinead and I will present Shell's Second Quarter 2026 results. In Q2, Shell delivered very strong results, driven by strong operational performance across our businesses. That performance reflects our relentless focus on execution, which enabled us to provide the critical energy our customers needed when it mattered. In Integrated Gas, strong performance across our global portfolio helped to offset some of the lost LNG volumes from Qatar. Take our LNG Canada joint venture, for example. This is a greenfield project that shipped its first cargo just a year ago, and it has already delivered more than 100 cargoes and achieved full capacity this quarter. In Upstream, our continued focus on performance also unlocked additional production this quarter. We continue to optimize and deliver turnarounds ahead of schedule, enabling performance such as in Brazil, where we delivered another quarter of record production. Our Pennsylvania Petrochemicals Complex also delivered its best performance to date, and our refineries achieved a record 102% utilization in a high-margin period. Our refineries have responded to what the market needs, shifting production towards middle distillates like jet fuel, capturing more value from our assets. These kinds of value-based decisions make a difference at a time when global energy flows are under pressure. And behind them sits an important structural strength: Shell's integrated model. The connectivity across our value chains creates the opportunities to optimize assets, product flows and market exposures from well to wheel. And as we remain responsive to the fast-changing conditions, we also have kept a clear focus on delivering our strategy and commitments. Structural cost reductions are progressing well, with $700 million delivered so far in 2026. Savings that are driven by changing the way we work across our organization, including operational efficiencies and a leaner fit-for-purpose corporate center, and the high grading of our portfolio has now delivered savings of close to $6 billion since 2022. We also continue to access long-term growth and strengthen our portfolio. Our acquisition of ARC Resources has won overwhelming support from ARC's shareholders, and we're now awaiting final regulatory approval. The ARC deal accelerates our strategy by sustaining material liquids production and growing our Integrated Gas business, lifting our expected production growth to 2030 from around 1% a year to some 4% compared with 2025. We have also signed contracts to operate the offshore Loran gas field in Venezuela. And in Namibia, we continued to create optionality, having drilled our most promising exploration well to date. At the same time, in Upstream, we have agreed to sell our nonoperated working interest in Na Kika in the Gulf of America, an asset that secured attractive value as it nears the end of its life. Taken together, this is high grading in action, releasing value from assets where we are no longer the natural owner and reinvesting it in the next generation of competitively positioned supply. We also recently announced the divestment of Sprng Energy in India, high-grading our power portfolio. And in Marketing, we completed the divestment of the U.S. Jiffy Lube network and announced the divestment of our South African mobility sites as part of repositioning the portfolio around our key markets. So while performing through today's volatility, we maintained discipline and kept up the momentum on our strategic delivery. And with that, let me hand over to Sinead, who will provide more details on our Q2 financial performance. Sinead Gorman: Thank you, Wael. In Q2, we delivered a very strong set of results. Adjusted earnings for the quarter were $9.8 billion, and we generated over $21 billion of cash flow from operations despite the ongoing disruptions in the Middle East. Strong operational performance across our segments provided the foundation for our delivery this quarter. In addition to this, LNG trading and optimization was able to capture significant additional value compared with last quarter. And I was especially pleased to see the Chemicals results this quarter with a positive free cash flow contribution. The hard work the team is putting into the transformation is starting to pay off, and combined with a more favorable margin environment this quarter's results represents the best we have seen in over 5 years, but there is much more to do. Now turning to our financial framework. Our cash CapEx outlook of $24 billion to $26 billion for 2026 is unchanged. This includes some $4 billion for the ARC Resources acquisition and associated cash CapEx. In Q2, we reduced net debt to some $42 billion, or $12 billion excluding leases. And today, we have announced $3 billion of share buybacks, which we expect to complete by our Q3 results announcement in October. In addition to this new program, we will also complete the portion of the previous buyback program that was halted due to regulatory restrictions associated with the ARC transaction. In summary, this quarter, we performed extremely well despite continued disruptions, we made significant progress across the portfolio, and we further strengthened our balance sheet whilst remaining focused on growing long-term value. And with that, let me hand back to Wael to close. Wael Sawan: Thanks, Sinead. This was a very strong set of results. The macro was supportive, but what these results show more than anything is that Shell delivers through volatility. We continue to drive performance, discipline and simplification throughout the organization as we deliver more value with less emissions. And we are confidently progressing our strategy at pace as we continue to build a more focused, more resilient and higher return company. Thank you. Operator: [Operator Instructions] Wael Sawan: Thank you for joining us today. We hope that after watching this presentation, you've seen how Shell delivered a very strong set of results through the strength of our portfolio and the quality of our execution. Now Sinead and I will be answering your questions. So please, could we have just 1 or 2 questions each so that everyone has the opportunity. And with that, could we take the first question, please, Jake. Operator: Our first caller is Biraj Borkhataria from RBC. Biraj Borkhataria: The first one is just on the distribution front. And going back to your comments in Q1, you cut the buyback -- yes, trimmed the buyback, let's say, the argument you made was you wanted to be agile and tactical. And I guess, just a view on the value of the buyback in terms of your share price. At the same time, you have a payout ratio and that calculus on the return on the buyback is not really embedded in a 40% to 50% payout ratio. So as we look forward, obviously, the impact of the war is maybe more pronounced than you thought at the time. But it looks like your run rate on distributions will be well below the 40% if you continue at this rate. So just trying to understand how you're thinking about squaring those 2 things off, the payout ratio, which you've committed to and then the return on investment of the buyback. And then the second question is just on the low carbon front. I'm noticing the capital employed is obviously steadily reducing. You've announced a few more sales. You've targeted at improving returns in that business. Could you say what proportion of that $15 billion capital employed you have on the books is generating acceptable returns at this point? And I'm thinking beyond the trading that goes into that segment. Wael Sawan: Okay. Sinead, do you want to start with the first one? Maybe I'll go to the second one after that. Sinead Gorman: Happy to. And thanks, Biraj, for the questions. Indeed, so first and foremost, I think it's fair to say that we have both the ability and a commitment to deliver 40% to 50% through the cycle. And we've been very clear on that throughout. This is definitely not about affordability in any sense. You talked about last quarter specifically and what did we do last quarter? So I wouldn't say we trimmed, I'd say we rebalanced. So as we discussed at the time, we rebalanced between both the buyback and the dividends. So we increased the dividends at the time when we moved the buyback to $3 billion. So that allowed us to stay within that payout ratio. We're very pragmatic on this and not dogmatic at all. We are dogmatic about the 40% to 50% through the cycle. But in terms of how we split it, we make that decision quarter-by-quarter, and we look through the quarter. We're not fixated every quarter on that. We're looking at where do we see the macro going to, what do we see in terms of how we can apply, and the funds, the extra free cash flow we have, whether that's to buybacks, whether that's to CapEx or whether that's to the balance sheet each quarter, and we take that decision. You've seen some of the quarters, we've been higher than that, above the 50% as well. So I would say we come back to the fact that it is sacrificing a value decision, but the 40% to 50% is the commitment that we have. Wael Sawan: Thanks, Sinead. Biraj, to the second question, been very pleased with the momentum we have to be able to continue to work on the $45 billion of underperforming capital employed. You touched on a portion of that, which sits in low carbon. I wouldn't divorce, by the way, the trading from the assets. A lot of our low-carbon business models are going to be trading back models. So what you see us doing is divesting assets that don't fit into a trading back capability and making sure that we are gearing all of our activities towards actually that trading back business model. Remember, some of that capital today is sitting unproductively because we are still building up, take CCS, for example, take Holland Hydrogen I in Rotterdam. So this is capital that will start to show a return likely in 2027 onwards. As I've said in the past, we will expect a return on that part of the business to be north of 10% before the end of the decade. And that's what we are working on over the coming years. Again, good progress. There's multiple different levers we're pulling, but we have some way to go. Thanks for the question, Biraj. Operator: Our next caller is Josh Stone from UBS. Joshua Eliot Stone: I wanted to ask about LNG. Very strong results from Integrated Gas this quarter, clearly quite a few moving parts, but also quite a few moving parts from the outlook for LNG. So curious as to what -- how you're thinking if you're thinking differently about the outlook for LNG prices. There was a strong consensus around a glut appearing, but perhaps that's not fair anymore. So curious any comments on LNG. And then related to that, or specifically to your business, are you seeing any change in customer behavior for LNG and Integrated Gas in terms of perhaps customers wanting to sign up to portfolio gas rather than contracting single assets? So if there's any early change in behavior, would be interesting. Wael Sawan: Thanks, Josh. I'll touch a bit on the behaviors, and I don't know if you want to give a perspective, Sinead, on the outlook. Early days, Josh, I think everyone is trying to sort of rewire themselves to the new realities. Qatar will continue to be, of course, a critical part of the overall LNG mix, with 20% of the volumes coming from there. We have not necessarily seen a lot of short-term action as a response of this other than in the spot markets. In the term markets, you continue to see the balance of new U.S. supplies coming into the market, potentially new announcements on FIDs elsewhere. People, of course, anticipating what might happen with LNG Canada Phase 2. All of that means that the market will continue to be well supplied. If I look now long term before coming -- before leaving Sinead to sort of cover the short to medium term, we continue to have very strong conviction, as you saw in our LNG outlook in the future of LNG. We're talking about 65% growth in that market between now and 2050, underpinned by this continued belief that gas will be a stabilizing force in the energy system because of its flexibility, its reliability, the security that it has and the ability to be able to have the adjacencies with the likes of renewables, but also as a substitute to coal or for that matter, heavy fuel oil when it comes to the marine sector. And so the underpinnings are strong. Short-term disruptions, of course, we look to manage through our trading organization. But longer term, we continue to have very deep conviction in that. But the outlook, Sinead? Sinead Gorman: Yes. I think you're talking about the market generically. And of course, when you take out some 25 million tonnes or more out of the market with what's occurred with the Strait, what we've seen of what was considered to be a bit more length was expected within certainly this year, you've taken that out. So that balance has changed. What are we seeing at the moment? We're seeing, of course, where pricing is going to is it's allowing actually some of the volumes to be redirected from where they've been going to, which is Asia, back into Europe, which is much needed as we very much know, because coming into this winter where you've got European volumes are -- sorry, European storage volumes are very limited and actually much below where we would have expected closer to the 50%. We're actually seeing that requirement very strongly here. That redirection is happening, but it does make for a tightness coming in the next quarter or so. Wael Sawan: Thank you, Sinead. Josh, thank you for the questions. Operator: Our next caller is Fergus Neve from Rothschild & Co Redburn. Fergus Neve: Two questions, please. So it was positive to see the recent success of the exploration well in Namibia. I wondered if you could comment briefly on the early differences and similarities between this discovery and the previously written off Graff and Jonker wells that makes this discovery more promising, as you mentioned in your opening remarks. And then secondly, just on the Chemicals result, which was strong this quarter, very positive to see that. Could you just comment on the relative split of this improvement between the self-help work you've been doing since the Singapore divestment and also the margin environment that we saw in the quarter? Wael Sawan: Thanks for that, Fergus. I'll take the first question and ask Sinead to address the second one. On the exploration well, we were indeed pleased with the result of that well. Again, early days. But what I would say is the biggest difference is in both the reservoir and the fluid characteristics. It was one of the best permeabilities, porosities that we had seen in the block, and it's opened up a new horizon for us to explore. We're now looking to expedite 2 appraisal wells to end of this year to be able to allow us to derisk some more volumes and see whether we have enough for an attractive profitable development. So more to come, I suspect, in 2027. Sinead? Sinead Gorman: Thanks, Fergus, for the question. Indeed, great to see Chemicals. The results they showed, the team is doing an amazing job here. And of course, there's 3 things that we're always looking at. We're looking at, as you say, the margins, then we're looking at the ability to actually be competitive and control our costs, and the ability to run the assets really well. Margins, you know as well as I do, how strong those have been this quarter. And of course, those helped significantly. But what the weighting is much more towards the fact of the cost takeout that we've managed and the operating capability of the assets. So what the team did very, very well was to be able to actually ensure that those assets were up and running. So in Pennsylvania at Monaca, they managed to ensure that it actually hit record performance as well. That allows us just to be able to push the product through and be able to actually take advantage of what is very strong margins as well, which gives us confidence as we go through, of course, and what will happen on quarter-on-quarter. Margins will change, but it has to be supplemented by that cost and that operational performance. So well done to the team. Thanks, Fergus. Wael Sawan: Thank you, Sinead. Thanks, Fergus. Operator: Our next caller is Michele Della Vigna from Goldman Sachs. Michele Della Vigna: Congratulations on the very strong results. As you know, there's been a lot of debate around reserve life in the sector. And it feels like FIDs are the biggest way to kind of sort that out and build reserve life for the future. It looks like you're making tremendous progress in a lot of areas. I was wondering specifically on Bonga Southwest and Zabazaba in Nigeria and on LNG Canada too in Canada, whether you could give us a bit of an update on when you expect those FIDs to take place. Wael Sawan: Michele, thank you for the question. Allow me maybe for a moment to be able to sort of frame because I think there's multiple angles to the question that you asked. For the last few years, we've talked about performance discipline simplification with this value over volume focus. And I'm really proud of how far the organization has come over this period. And you can see it in the results. What we have been able to do is, in essence, to be able to strengthen and cement the foundations of our base free cash flow, which has been, if you look over the last few years, roughly $25 billion to $30 billion per year on a $70 real-term basis, right? And we've also been able to extend that. That's been an area we've been very focused on. So extending that stable free cash flow. We have now fully derisked the 2030 period through multiple moves, and we've talked about them in the past. And we are well on our way towards the 2035 period and beyond. So that base, that strong foundation, is very much in place. Now to your point around additional growth, we are now starting to add layers of absolute free cash flow growth. ARC, of course, once it's completed, will add, as we reported last time, roughly $1.5 billion per year. That's additional. LNG Canada Phase 2, provisionally, if we take an FID on that, we'll add the next layer in the 2030s. You asked when that's going to happen. It's likely to be before end of this year is what we are targeting along with the joint venture partners, subject, of course, to all the requisite approvals. And so those layers that we are adding are really shifting us from a free cash flow per share growth, which we have said is our North Star that is maybe more weighted towards the denominator, the buybacks to one that's more balanced with continued preference for buybacks and with continued absolute free cash flow growth in the numerator. And that's the exciting story that we are trying to drive. There are multiple other projects which we are also pursuing. You touched on a couple of them. Bonga Southwest, we are hoping to be able to be in a position to FID in 2027. And Zabazaba, also around '27, '28. And so lots of good momentum going on, and these are the projects that will continue to add those layers above that base free cash flow that I talked about. Hopefully, that allows you to sort of get a bit of a sense of where our mind is on some of these things. Okay. Operator: Our next caller is Doug Leggate from Wolfe Research. Douglas George Blyth Leggate: Wael, I wonder if I could hit 2 things that appear to be taken on a little bit of a life of their own. One is disposals and the other is your cost-cutting target. The disposal momentum seems to have picked up here recently. And I wonder if you could just give us a refresh on what you think that visibility looks like as you monetize perhaps underperforming assets as you've done this last couple of announcements. And then my follow-up is on the $5 billion to $7 billion cost-cutting target. You're about halfway there, 3 years or 2 years early. So I'm wondering if you could frame for us what the risk is that those numbers get reset and any kind of magnitude you could put around that. Wael Sawan: Thank you for that, Doug. I mean -- I think you mean the opportunity to reset them rather than the risk, but I hear where you're going with it. Let me talk about that second point and maybe, Sinead, if you want to touch on the divestment. On the cost-cutting targets, I think, firstly, when I stood here 3 years ago and talked about $2 billion to $3 billion structural cost reduction, it was hard work. We had to sort of try to mobilize the organization and figure out how we can get that. The flywheel started to turn. And we put the next target out there, the 5% to 7%, and indeed, really pleased how all of our business leaders and all of our functional leaders have really responded to the challenge. And the challenge, by the way, is not just a structural cost reduction challenge. It is a free cash flow enhancement challenge. That's what we're trying to drive. Improve reliability, improve availability, enhance business models, turn around underperforming businesses and become leaner, more focused as an organization. So that's been embraced. We are now halfway through that band that we talked about. I continue to be encouraged by what I see, Doug. There's more and more opportunities than maybe we had banked for. And so my push to the team now is we need to be able to get to the top end of this range, and that's what we're working towards. But not only that, we need to keep thinking about what comes next. What are the other ideas? How do we leverage AI in a way that allows us to unlock more value? How do we challenge whether we are running the businesses in the most efficient way, not just against what the benchmarks of today are telling us, but what is going to be the next benchmark and how do we get ahead of the competition there? So this is much more of a culture journey than just a numbers game. And if anything, I'm energized by what I see in the organization around it. Sinead? Sinead Gorman: Thank you, Wael. And Doug, indeed, great question around our divestment program. And again, what I would say with respect to that is probably a couple of years ago, we talked to you about saying we want to be really good stewards of capital. We want to ensure that what we do is we reallocate capital. And that's what I would say we are doing across this company, whether it's around our distributions and back to shareholders or looking at where are we the rightful owners of certain assets or not. We're taking a lens asset by asset and making sure we look at can we extract the maximum value or should somebody else be doing that? We're then taking those proceeds and of course, reallocating those. So what you saw us do this quarter was a number of divestments came through, some of them where they were noncore like Jiffy Lube, which whilst lubricants is an excellent business for us and very strong ROACEs for us in particular, Jiffy Lube was not at the top end of that. So we put it into somebody else's hands, and you see that coming in. Again, in the Downstream, you saw us take the tail of some of our mobility sites that's in South Africa. We've been doing that step by step, and you've heard us talk about Mexico before. So that's just normal progress for us where we're coming out of some of those. And of course, what you saw us do in Upstream as well, liquids is key for us, but there are certain places where we look at can we get a fair price for the asset and who is the rightful owner? So when we look at that in the Gulf of America, we've got a great operator who will take control of it. It's towards end of life and it's a fair price that we get there as well. And then you look at our Renewables portfolio. We've talked before about where do we have capabilities versus others and hence, the exit from Sprng in India as well. That allows us to take those funds and look at how do we reallocate it. And you've seen us reallocate into many areas in Upstream like Ursa in the past in Brazil, but particularly ARC is the one. Now we can't always time correctly the point at which we get a great acquisition that really fits us and divestments. But of course, when we did the deal for ARC, we knew that this divestment program was coming, and you can see that it more than offsets in terms of the cash coming through. So that capital reallocation program is in full swing. There's much more to come on it as well as we continue to hold ourselves to account at a very high bar. And of course, it leads to a ROACE increase over time as well. Thanks, Doug. Wael Sawan: Thank you, Sinead. Thank you, Doug. Operator: Our next caller is Kim Fustier from HSBC. Kim Fustier: I just wanted to ask about the really remarkable operational performance in the Downstream, notably the 102% refinery utilization. I do take [ on board to get ] the range of guidance for 3Q, but maybe more conceptually, how much of this high refinery utilization rate is sustainable? I mean, how long can you continue to operate above 100%, just thinking about maintenance cycles, et cetera? And my second question is on the ARC deal. I see that it's now scheduled to close in the third quarter, subject to remaining regulatory approval. Could you maybe give us an update on the Investment Canada approval? Wael Sawan: You want to start with the second question, straight forward? Sinead Gorman: Yes, happy to. Really short one on this one, Kim. Indeed, we were really thrilled with the answer that came through in terms of the shareholder vote. It was overwhelming in terms of support. We've said it is in Q3. That very much depends on the last approval, which, as you say, is Investment Canada Act. We are investing heavily in Canada, and we believe that, that will be something that comes through quite readily with good discussion with the relevant authority. We can't comment on when that would be. That will be down to their timing, but we're working it very hard at the moment. Wael Sawan: Thanks, Sinead. Kim, the operational performance of Refining has been excellent. But I have to shout out all the businesses. I mean, we have been talking about performance for a very, very long time. And I hope you see now the consistency in the delivery across all the businesses. And when you have an Integrated Gas, for example, Qatari volumes out and you're still getting roughly the same LNG output, it just speaks to the rigor with which the organization is pursuing that performance drive. On Refining, team's done a super job. And there's a few things. Firstly, turnarounds, in particular, safety-related turnarounds, we always pause and do what we need to do. So this is in no way changing turnaround time frames other than if it is not safety critical. And then, of course, we look at the market. I'd say the biggest difference we have seen came over the last year or so. In many people's minds, trading conceptually is traders sitting behind the desk and trying to sort of guess where the market is going. Our trading and optimization is fundamental to Shell and our business model. It is interwoven into every single one of our value chains. And where it is not, we are pushing it further and further. Which is why Andrew Smith, who heads up Trading and Supply, sits on my Executive Committee. So to give you a small example, at Norco in the U.S., we have moved into a model where the traders are tied at the hip with the operators, finding the right feedstock to be able to source given the dynamics in the market at the moment. And then the products traders finding what's the best placement and reading all the price signals to be able to then manage how much do we push into jet fuel versus -- or at the expense of diesel and gasoline, and how do we optimize for value. And so much more of what we see at the moment is that the run rate is being determined by commercial factors driven by our trading organization in partnership with the asset. We are rolling that model out in every single one of our refineries and have tested it and really been pleased with what we see. And so I do continue to believe we are able to deliver performance sustainably. And of course, it will vary quarter-by-quarter depending on where we are on the turnarounds, maintenance schedules. But I have high confidence in our ability to sustain and continue to improve on what we see. Thanks for the questions, Kim. Operator: Our next caller is Nash Cui from Barclays. Naisheng Cui: I have 2, please. The first one is on trading. Just want to follow up because we have seen significant volatility in commodity prices in July. I think earlier, Sinead also mentioned the potential LNG tightness in Q3. I wonder how should we think about trading performance in Q3, please? And then my next question is on CapEx. How confident are we in maintaining the CapEx guidance this year, please? Especially given the disruption in the Middle East. We have heard companies talking about higher cost for -- higher cost to get the rigs FPSO. I wonder what are you seeing in the market right now? Wael Sawan: Nash, thank you for that. I'm going to take the first question on Trading and Supply and then maybe, Sinead, if you want to address CapEx. So firstly, indeed, we have seen that volatility play through in the past quarter. But if I step back for a second, Nash, if you'll have heard me over the last 15 quarters when I've had the privilege to be in these calls, what you'll have heard me say every single quarter is that volatility and uncertainty is what we see in the next quarter. We fundamentally believe that the energy system is inherently becoming more volatile. So rather than worrying about the direction of the volatility, what we are focused on is the things we can control, improving the performance of our assets so that our trading and optimization organization has the molecules. We're driving hard to be able to make sure that the portfolio, the diversity of supply points and the health of the portfolio is one we would like. And of course, continuing to maintain a strong balance sheet to be able to take advantage of opportunities. And so our Trading and Supply. As a company, we are built to be able to handle volatility. I would argue we are the name: if somebody believes in volatility in the energy system, Shell is the name to go after. I'd also argue that we are the name to be able to be the downside price protection in the energy sector, given our Downstream footprint and given our ability to be able to unlock value even in downside volatility. And that's the business model we have built. And so as we look to the coming quarters, what I can tell you is the 2% to 4% ROACE that Trading and Supply is able to deliver continues to hold. And as you would expect, we are at the top end of that range given the current volatility. And if the volatility continues into the third quarter, we expect to continue to be in a healthy part of that range. We don't, of course, guide on particular numbers quarter for quarter and the traders will have to depend on where the market is. But we continue to see that this trading capability, one that others are trying to build, is a truly differentiating feature in our business case. Sinead? Sinead Gorman: And the one add I would have there, Wael, is for Q3, the biggest thing we can do is ensure that the operational performance is strong, that gives the volumes to the trading team to be able to maximize value, whether there's volatility or not, but I agree on the volatility. With respect, actually, you asked, Nash, around our CapEx and are we confident in terms of maintaining the guidance. If you remember, we had a $20 billion to $22 billion per year guidance. And when we did the ARC transaction, we increased that to $24 billion to $26 billion. The reason for that was to cover not only the cash component of the transaction, but also to cover the ongoing CapEx for the rest of the year to ensure we maximize that value from ARC. So our range is $24 billion to $26 billion. We are confident in our ability to be able to deliver within that range, and we continue to maintain that range at the moment. We absolutely see inflation in the system, which is what you're referring to at the moment. That varies per category. But overall, we're seeing it around that 5% to 6%, but we're able to offset much of that given our scale and those framework agreements we have, but also because we have locked in many things because we saw some of this coming as well. So we have confidence in the ability to do that. You asked specifically about rigs. That's less of a problem for us at the moment because we had locked those in, in advance, but we do see indeed what you're seeing of much more pressure in the system around those, as prices are high at the moment. Wael Sawan: In particular, those deepwater rigs. Thank you, Sinead. Operator: Our next caller is Matt Lofting from JPMorgan. Matthew Lofting: My congratulations on strong performance in far from normalized conditions. I'd like to ask you first about Integrated Gas, very strong numbers in the second quarter despite the impact of the Qatari assets. I wondered if you could just expand on the extent to which in conditions you're seeing a degree of natural hedge almost within the business insofar as the downtime or lost volume in the Middle East being mitigated by the rest of the portfolio and perhaps stronger margins as a result that you're able to extract through the rest of that portfolio, particularly the third-party component. And then second, you mentioned earlier the strength of operational performance across the business in the second quarter, very evident. I wanted to ask you specifically about Brazil. I think you highlighted record production in the second quarter. We've seen several strong data points from that hub over the course of the last couple of years. Are your expectations of the midterm oil production that can be extracted from Brazil seeing some upward support? Wael Sawan: Matt, thank you for that. I'll take the second question and Sinead, leave you to the first. I mean I think on Brazil, Matt, specifically, of course, we have an enviable position there, roughly 10% of the overall production in Brazil. The old adage of big fields get bigger, of course, applies in the context of the Tupi fields, the Iracema fields, the Mero fields. And so what continues to happen is that Petrobras, a great operator, continues to look at ways to be able to optimize the facilities and how they do water management, for example, how they are able to shift across their many wells to optimize production and to be able to take advantage of the opportunity right now given where commodity prices are. I don't want to make predictions as to the future, but what I can say is we continue to be very encouraged by what we see in the subsurface and importantly, in the way that Petrobras runs these assets, and we continue to hope we can contribute to support them in doing that. Sinead Gorman: Thank you, Wael. And in terms of the Integrated Gas portfolio, they had an exceptional quarter, I absolutely agree. Given the challenges that they had as well, not only the volatility, but also the fact that they had lost those volumes from the Middle East, a couple of things that played in. Whilst the loss in Qatar had its impact, and it definitely did, the focus was for us in order to be able to manage across the portfolio, as you say. So whether you call it a natural hedge or not, it was a portfolio management approach. So what we saw was, particularly in Nigeria, we saw more volumes coming out of Nigeria, also from Trinidad, but also as Wael mentioned in the video as well earlier on today, specifically around Canada. So we saw LNG Canada come into its own. We're now more than 100 cargoes out from that facility. So what we saw, whilst we were really struggling, having lost the Middle East volumes, we were able to compensate from elsewhere. On top of that, what the team did really well was almost record volumes from third party. So indeed, they went out into the market. They looked at where they could cover and in some cases, buying back some of our own cargoes that we had sold to them to be able to distribute elsewhere, i.e., taking from those customers who weren't as impacted by the Middle East and being able to push them to those who were. That allowed a significant busy compensation from what occurred in Qatar. And beyond that, some price risk management as well, which was very thoughtfully done, given the volatility and the absolute moves we saw throughout the quarter. Wael Sawan: But it's been a tough struggle, lots of headwinds with credit to the team, how they've been able to manage it. Thank you for the questions, Matt. Operator: Our next caller is Mark Wilson from Jefferies. Mark Wilson: There's been a lot of ground covered so far. So let me ask regarding the Middle East assets, yes, obviously, Qatar, but also Pearl GTL. If a normalized shipping environment comes, could you remind us on the time to get those 2 facilities back to their expected capacities, please? Wael Sawan: Yes. Thanks, Mark. Let me separate 3 different assets. So you have Pearl GTL Train 1, same asset, but second train, Pearl GTL Train 2, and then Qatar LNG, which is the other asset that we have in Qatar. The LNG assets are typically easier to start up and to start the shipping out, of course, subject to terminal capacity, subject to storage, subject to shipping availability and the like. The biggest thing we're watching out there for is just access and safe passage through the Straits. Similarly, on one of the trains at Pearl GTL, so Train 2 -- Train 1, where it would actually take in a matter of weeks to be able to get the facility back up and running. That's a facility that hasn't been impacted by the activities by the hostilities in the region. And so within weeks, we could start up that facility. The one that has been damaged, that second train, we expect the repairs, which are now progressing to be completed and for that facility to be ready to go, again, subject to our ability to export by end of the first quarter of next year. So by end of Q1 2027 is when we could expect that facility to be back online, subject to the conditions allowing us to ship out. Hopefully, that gives you a broad sense. Thank you for the question, Mark. Operator: Our next caller is Henry Tarr from Berenberg. Henry Tarr: I had 2. One was just on Venezuela. I think you're looking to push ahead with the Dragon project. I just -- any update there would be great. And then also how you're thinking about managing exposure to Venezuela? And then secondly, clearly, so far in July, it appears as though the Downstream environment continues to be extremely strong. Is that the case that you're seeing that roll through for your refining and chems businesses so far through July? Wael Sawan: Let me start with the first one, Sinead, if you want to touch on the second one. We continue to be pleased with the progress we are making in Venezuela. You touched, Henry, on Dragon, which is one, of course, that we had been working on until the OFAC license was paused and then it has been again, of course, approved again. So we've continued work. We hope to be able to move towards an FID decision at some point in 2027, all going well. We've also recently, of course, been granted the license for Loran Phase 1. That's a 1.7 Tcf opportunity that also could potentially tie back into the Trinidad and Tobago LNG facility, Atlantic LNG. And so the team is currently developing that opportunity. Again, that's an opportunity which we think we can move pretty quickly on because it leverages existing infrastructure we are building in the Manatee development, which again will be starting up in the next 12 to 18 months. And so what you have is a nice cluster of developments, material developments that we hope to be able to bring to first -- to first gas in the coming couple of years. Sinead? Sinead Gorman: Thank you. Indeed, with respect to what are we seeing in this next quarter in Q3, the things that we always look at, of course, are margins, then the volatility and the operational performance. So those are the 3. We've talked before about needing to make sure that, that operational performance plays through, Henry. And what we did have in Q2 was very few turnarounds, particularly in our Downstream business. They were very limited and those that did occur were very quickly done. You see a little bit more happening in Q3. So what are we seeing from a margins perspective specifically there? We're seeing, of course, a positive margin environment for Refining in Q3, but the chemical spreads are beginning to soften. We do see that come through. And we're seeing, of course, less volatility, which means a little bit less coming in, in terms of our Downstream business from the trading angle of things as well. In particular as well, of course, from our lubricants business, it will be a little bit more challenging in this quarter because, of course, it's relying on some of the volumes coming through from Pearl, which we've just discussed, which we're not expecting to see come through in the near term. So the team are having to manage very hard to find alternatives for that and doing so very successfully so far. Wael Sawan: Thanks, Sinead. Henry, thank you for those questions. Operator: Our next caller is James West from Melius Research. James West: Two quick ones from me. One is on the -- with the ARC transaction probably closing soon, you've got your feedstock for Phase 1 of Canada LNG. Does that change your view on the FID of Phase 2 or the scope of Phase 2 and the timing there? And then secondarily, I believe you had a discovery offshore Egypt here in the last couple of days. And I'm wondering if you could give us any kind of early indications of that. Wael Sawan: Yes. Thanks for those, James. I'll touch on both quickly. On Egypt, very early days. What the well has proven is that there's a working petroleum system there. But too early to call as to whether we can find a way to make this a commercial discovery and the follow-up implications. And so the team will be looking through that, but very early days. So nothing to sort of report there. On ARC, Sinead talked about where we are in the process on ARC. I would just sort of say Phase 1, we had already underwritten through our existing acreage from Groundbirch. So we were very comfortable. And we had some spillover also into Phase 2. When we took the decision on the acquisition of ARC, we didn't even put Phase 2 into the base economics. That's upside if we end up taking that final investment decision. And so we will have enough gas to be able to underwrite a second phase if we so choose to take that FID and to be able to continue to create value through other ways as ARC themselves have been doing, creating a premium on AECO. And by leveraging our Trading and Supply organization, we hope to be able to match and improve on that as well going forward. But lots of good work there. And upon completion of that transaction, we're really excited to welcome that ARC Resources family into Shell and really see what more we can do to unlock value and to really demonstrate to our shareholders. It's a big call we have made to be able to use, for example, paper for a good portion of this. We recognize that we need to be able to deliver returns on it. We have already -- we see line of sight to double-digit returns. But I do expect my teams to aspire to meet mid-double-digit returns if we can and really demonstrate the value that we can create whenever we choose to use paper. And so really exciting days ahead there. Operator: Our next caller is Jason Gabelman from TD Cowen. Jason Gabelman: You guys released your annual LNG presentation earlier, but you didn't have the typical webinar that you have with it. So I was wondering if I could just get your perspectives on the LNG outlook. And specifically, it looks like you're calling for perhaps a bit more of a balanced to oversupplied market into the early 2030s compared to a previous view that maybe the market should be balanced to undersupplied by then. So what has changed? And does that inform how you pace your investments in new LNG plants? Wael Sawan: I'll say a couple of words, and then please, Sinead, add if you want to as well. Indeed, we did not this time, add a webinar, which we typically have done, and we actually delayed the issuance of the outlook because it was in the midst of the start of hostilities in the Middle East. And given how many people in the Middle East were involved in the preparation of this, we chose to pause and then just issue it without the webinar. But long story short, as I said earlier, the -- we reaffirmed long-term conviction about 2050 and the 65% growth. I think the biggest thing that we also wanted to point to in the LNG outlook is just how incredibly resilient the LNG market has shown itself to be. Remember, at a time when some 20% of supplies were constrained because of the blockages in the Straits, customers continue to get LNG. And so that's a key piece of the overall puzzle. So we anticipate, as per the LNG outlook, around 180 million tonnes of new annual supply to be coming into the market by 2030, which, of course, continues to strengthen that market. But on the demand side, there's significant growth that we are seeing in multiple areas. We're seeing it in areas like transportation, maybe more so than we had predicted a few years ago. And we continue to see the adjacency that it plays into the power and particular into renewables. The biggest growth we continue to see is in Southeast Asia, in particular, countries that already depend on gas -- indigenous gas, where they are starting to mature those fields, and they need to import and leverage the existing gas infrastructure that they have in their countries. And of course, Europe continues to be a big draw on LNG coming forward. So all of that continues to play up, Jason, in our views. And no one can predict when the tightness is going to happen, but short-term disruptions are inevitable in any commodity market. The long-term outlook continues to be very, very solid. Is there anything, Sinead, that I missed? Sinead Gorman: No. Thank you. Wael Sawan: Good. All right. Thank you. Thanks for the question, Jason. Operator: Our next caller is Christopher Kuplent from Bank of America. Christopher Kuplent: Wael, I've got one question for you. Maybe you can give us a little bit of an insight into how busy your M&A team is these days. The ARC deal is about to close. Are you telling them, please don't show me any more ideas because I'm busy enough integrating ARC. Apologies, it's been a while that I've spent my time working for M&A bankers. So just a bit of color on how busy you are these days, considering how many deals you must be being shown at least. And then if I may, Sinead, 2 very quick ones. I'll dare ask you 2. Firstly, there has been a considerable lag in terms of cash tax payments versus the P&L in the first half. Do you expect any of that to persist or get recovered into the second half of 2027? And then maybe briefly again on the famous payout ratio. I hope you'll agree, see whether I'm putting words in your mouth that 40% in a very high absolute cash flow world is the countercyclical thing to do when it comes to the full year data when we have another 2 quarters under our belt. Wael Sawan: Christopher, thank you for those questions. I'll start with the M&A one and then leave Sinead to address the others. I think the first thing I've been saying to the team is thank you for the terrific job that they have done on ARC Resources. We're not done yet. But I think the -- this was, as I've said in the past, a deal we had been looking at for a couple of years. And when the stars aligned, we really moved. So I was really proud with how they've moved on that. Then Christopher, maybe back to what I said earlier. So I talked about how we had strengthened that free cash flow foundation, the base that we have, the $25 billion to $30 billion, and ARC having been sort of additive and potentially LNG Canada Phase 2 being additive. So I'm very comfortable with where we are on our growth trajectories at the moment. We are not constrained, but we will continue to be disciplined. We have always said we will be disciplined. We've always said we will hold ourselves to a high bar when it comes to M&A. And while, of course, we always look at multiple opportunities, what I can tell you is nothing at the moment that I have seen comes close to ARC Resources. And so that high bar will continue to play in our minds, and we'll continue to see where the opportunities emerge. If I'm to diagnose where the market is at the moment, it's clearly more of a seller's market when it comes to oil. So very little in terms of opportunity space there. But there are pockets where it might be a buyer's market, and we've looked at those. But as I said, nothing that is meeting the threshold that ARC was at. And therefore, we continue to focus on what it is that we can do, and that's to grow the fundamental free cash flow through the levers we have. Sinead? Sinead Gorman: Thank you. Wael, indeed, and 2 slightly different ones, as you say, Christopher. On the first one in terms of the lag in cash tax payments, nothing too much on this one. It really is just the timing of when the mismatch between when you actually earn it and then when you pay it and just the timing with the payment dates set by government. So nothing really within our own control. It really is driven by their side of things. You typically see it a little bit higher, of course, in Q1 and Q4 versus Q2 and Q3. Of course, it shows up quite significantly when you're sitting on free cash flow this quarter of some $17 billion in 1 quarter. So that's where you see it start to pull out. And your point on payout ratio in terms of being countercyclical, you know I'm never going to guide on anything. But indeed, the 40% to 50% is what we said is definitely sacrosanct. And from our perspective, yes, we have high conviction in share buybacks, and we continue to do so. But we do focus on value. As you know, it's about value, not about affordability in this case. And you've seen the way we've acted in the past. So we're always very confident in doing our buybacks when the time is right. Wael Sawan: Thanks, Sinead. Operator: Our final caller is from Maurizio Carulli from Quilter Cheviot. Maurizio Carulli: Congratulations for the excellent results, first of all. I have 2 questions, if I may. One probably for Wael and the other one for Sinead. For Wael, is there a case for modifying in the future the design of facilities in riskier countries like in the Middle East, so that they become more protected from physical attacks and if hit, more resilient to an easier and quicker restart of operations? And for Sinead, Shell has been historically one of the best, if not probably the best company in terms of thoroughness of financial reporting. And is there a case there for providing a bit more of detail within the financial reporting about your trading activities, particularly given that they are properly backed by assets, therefore, it's something more structural rather than what would be a trading activity of a financial institution? Wael Sawan: Super, Maurizio, thank you. I'll take the first one. I loved how you approached the second one, congratulating and complimenting Sinead and then going after the jugular on trading. So I will leave her to address that one. On modifying facilities, difficult one, Maurizio. I think the reality is with the emerging technology these days, there is no foolproof full protection. The biggest thing we can do from a company perspective is to continue to indeed add whatever layers of security we can add. And we need to continue to diversify the sources of supply in our portfolio because as we have seen, whether it's arteries getting clogged, whether it is countries involved in hostilities, there is no singular way to be able to totally sort of protect these assets. But we will continue to operate as we do in very close coordination with many of the countries in which we operate to be able to protect these assets to the best of our abilities. I'd say the second big piece that we are very focused on as a company is also cyber defense. Because physical is one approach. The cyber is the other one. And we have some very, very focused efforts across the company to continue to keep up with the evolving cyber landscape and making sure that we protect our assets from an OT perspective where we can. And so that is the nature of the world we are in, and it goes back to my earlier point, we continue to see the energy system of the future being more volatile. And this is why we want to continue to be the name that can capture that upside volatility and that can protect to the downside, and that's what we can offer our shareholders. Sinead? Sinead Gorman: Thank you, Maurizio. I always love a compliment, so thank you very much for that. I would say we often get told that our reporting is almost too thorough, that we give too much information that makes our annual report quite a tome to go through as well. But in all seriousness around it, we are trying to make sure that we give you as much transparency as possible or give our investors as much transparency so that they can understand fully the value of this company. What we do, of course, is for us, trading is actually much more around being able to optimize around the assets of the various businesses. So it is not a segment in its own right. It is the other businesses that it pulls on for the volumes, et cetera. We allocate capital to those segments rather than specifically to trading as well, and that's why we report it in the manner we do. We're trying to give you a bit more information around that. We've told you as an example, that we've never lost money in any quarter in the last decade, as we said in our Capital Markets Day 2025. And giving you that feel, as Wael talked about earlier, that in terms of that uplift to our ROACE of 2% to 4% in times like this where we've got a lot of volatility, trading does play out stronger and is able to utilize those volumes, and therefore, we're at the upper level of that 4%. We're looking to give you a bit more detail on our next Capital Markets event, which we're hoping will be at some point in the first half of 2027. So we'll go into a bit more detail then as well. But thanks for the question. Wael Sawan: Thank you, Sinead. Thank you, Maurizio, and thank you for all your questions and for joining the call. In conclusion, we delivered a very strong set of financial results in the second quarter, supported by another quarter of strong operational performance across all the businesses. We remain focused on executing our strategy, on transforming our portfolio and on delivering on our key targets. We wish everyone a pleasant end of the week. And for those going on leave, a well-deserved rest. Thank you, everyone. Before you buy stock in Shell Plc, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Shell Plc wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $386,727!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,232,139!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 3, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Shell (SHEL) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Shell PLC Unsponsored ADR? Here are five stocks we like better. Strong quarterly performance: Shell reported $9.8 billion in adjusted earnings and more than $21 billion in operating cash flow, supported by LNG trading, record refinery utilization, stronger Brazilian production and improved chemicals results despite lost Qatar volumes. Capital returns and portfolio restructuring: Shell announced a new $3 billion share-buyback program, reduced net debt to about $42 billion and delivered $700 million in structural cost savings during 2026. The company also continued divesting noncore assets while targeting $5 billion–$7 billion in structural reductions. Growth focused on ARC and LNG: Shell expects regulatory approval for its ARC Resources acquisition in the third quarter, potentially raising production growth to about 4% annually through 2030 and adding roughly $1.5 billion in annual free cash flow. The deal also supports a potential final investment decision for LNG Canada Phase 2 by the end of 2026. Draining the Tank: Big Oil Runs on Fumes Shell (NYSE:SHEL) reported second-quarter 2026 adjusted earnings of $9.8 billion and more than $21 billion in cash flow from operations, as strong operational execution and LNG trading helped offset lost volumes from Qatar amid Middle East disruptions. Chief Executive Officer Wael Sawan said the company delivered “very strong results” across its portfolio, citing record refinery utilization, higher upstream production in Brazil, improved chemicals performance and progress on structural cost reductions. Chief Financial Officer Sinead Gorman said Shell reduced net debt to about $42 billion during the quarter, or $12 billion excluding leases, while maintaining its 2026 cash capital-expenditure outlook of $24 billion to $26 billion. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now What a Gold Miner and an Oil Trust Reveal About Today’s Market Shell said its integrated gas business was supported by production from across its global portfolio despite lost Qatari LNG volumes. Sawan highlighted the LNG Canada joint venture, which reached full capacity during the quarter after shipping its first cargo a year earlier. The facility has now delivered more than 100 cargoes, he said. Gorman said Shell increased supplies from Nigeria, Trinidad and LNG Canada while also sourcing nearly record third-party volumes to manage the reduction in Middle East supply. The company was also able to redirect cargoes to customers affected by the disruption, she said. → Microsoft Just Flipped the AI Spending Narrative Overnight Energy Is Leading in 2026—But Are the Oil Majors Cracking? Shell’s refining operations reached a record 102% utilization during a period of high margins. Sawan said the company shifted production toward middle distillates, including jet fuel, in response to market conditions. He described Shell’s trading and optimization operations as closely integrated with refinery operations, including decisions on feedstock sourcing and product placement. The company’s Pennsylvania petrochemicals complex delivered its best performance to date, while Gorman said the chemicals segment generated positive free cash flow and recorded its best quarterly result in more than five years. She attributed the improvement primarily to cost reductions and operating performance, alongside a more favorable margin environment. → Carrier Earnings Could Send the Stock to a New All-Time High For the third quarter, Gorman said refining margins remained positive, although chemicals spreads were beginning to soften. She also said Shell expects lower trading-related benefits in downstream operations amid reduced volatility and said the lubricants business faces challenges from reduced volumes from Pearl GTL. Shell announced a new $3 billion share-buyback program, which it expects to complete by its third-quarter results announcement in October. The company also plans to complete the remaining portion of a prior repurchase program that had been halted because of regulatory restrictions related to the ARC Resources transaction. Gorman reiterated Shell’s commitment to distribute 40% to 50% of cash flow from operations to shareholders through the cycle. She said the mix between dividends and buybacks would continue to be assessed quarter by quarter, based on macroeconomic conditions, capital expenditure needs, balance-sheet considerations and the value of repurchasing shares. Shell has delivered $700 million of structural cost reductions so far in 2026 and nearly $6 billion in portfolio-related savings since 2022, according to Sawan. The company is targeting $5 billion to $7 billion in structural cost reductions and is working toward the upper end of that range, he said. The company continued to reshape its portfolio during the quarter. Shell agreed to sell its non-operated interest in the Na Kika asset in the Gulf of Mexico; completed the sale of its U.S. Jiffy Lube network; announced plans to divest South African mobility sites; and announced the divestment of Sprng Energy in India. Gorman said these moves reflect an asset-by-asset capital-allocation approach, with proceeds being redirected toward areas where Shell sees stronger returns. She said the company’s divestment program would more than offset the cash impact of the ARC transaction. Shell said ARC Resources shareholders had provided overwhelming support for Shell’s acquisition of the Canadian producer, with the deal awaiting final regulatory approval under the Investment Canada Act. Gorman said Shell expects the transaction to close in the third quarter, subject to that approval. Sawan said the transaction is expected to lift Shell’s expected production growth to 2030 to about 4% annually from roughly 1% annually compared with 2025. He added that ARC is expected to contribute about $1.5 billion a year of additional free cash flow once completed. The acquisition also supports Shell’s LNG Canada business. Sawan said Shell had already underwritten LNG Canada Phase 1 using existing Groundbirch acreage, while ARC would provide enough gas to support a potential second phase. He said Shell is targeting a final investment decision on LNG Canada Phase 2 before the end of 2026, subject to partner and other approvals. Elsewhere, Shell expects it could take final investment decisions on the Bonga South West project in Nigeria in 2027 and on Zabazaba around 2027 or 2028. In Venezuela, Sawan said Shell hopes to reach a final investment decision on the Dragon project in 2027, while the company is developing the 1.7 trillion-cubic-foot Loran Phase One opportunity for a potential tieback to Atlantic LNG in Trinidad and Tobago. In Namibia, Shell drilled what Sawan called its most promising exploration well to date. He said the well showed strong reservoir and fluid characteristics, including some of the best permeability and porosity encountered in the block. Shell plans to expedite two appraisal wells by the end of 2026, with further updates potentially coming in 2027. Management maintained a positive long-term view on LNG demand, with Sawan reiterating Shell’s outlook for 65% market growth between now and 2050. Shell expects approximately 180 million tonnes of annual new LNG supply to enter the market by 2030, while pointing to demand growth in Southeast Asia, Europe, transportation and power systems. Gorman said the removal of more than 25 million tonnes of supply from the market due to disruption around the Strait had altered the near-term balance. She said higher prices had allowed volumes to be redirected from Asia toward Europe, where gas storage levels were lower than expected heading into winter. Regarding its Qatar operations, Sawan said Qatar LNG assets could restart relatively quickly once safe passage, terminal capacity, storage and shipping availability permit exports. He said one Pearl GTL train that was not damaged could restart within weeks, while repairs to a damaged second train are progressing and could allow it to return by the end of the first quarter of 2027, subject to export conditions. Shell plc (NYSE: SHEL) is a global integrated energy company that operates across the full oil and gas value chain as well as in developing lower-carbon energy solutions. The company traces its roots to the early 20th century merger of Royal Dutch Petroleum and Shell Transport and Trading, and today it is organized to explore for and produce hydrocarbons, process and refine them, manufacture petrochemicals, and market fuel, lubricants and related products under the Shell brand around the world. Shell's principal activities include upstream exploration and production of oil and natural gas, integrated gas operations including liquefied natural gas (LNG), and downstream refining, supply and marketing. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Shell Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Chevron reported its largest quarterly net profit ever—$12.1 billion—on Friday as the Big Oil giants demonstrate how they’re reaping the rewards of the Iran war’s oil and gas supply disruptions worldwide. ExxonMobil’s $14.5 billion second-quarter income and Shell’s $10.8 billion in net earnings represented their most profitable quarters since 2022, when they previously benefited from Russia’s still-ongoing invasion of Ukraine. Not only are the oil and gas producers profiting from much higher crude oil prices, they’re also gaining from record oil-refining margins and sky-high petrochemical gains in North America—all of which are up because of the effective closure of the now-infamous Strait of Hormuz. The combined windfalls triggered rare net profits in the 11 figures. Citing further bullishness, Chevron CEO Mike Wirth said he doesn’t expect the conflict to result in much reduction of global fossil fuel demand beyond the short term. “Demand destruction is not obvious to me at any significant scale,” Wirth said on the earnings call. “I would say it’s hard to find evidence of that at this point.” The caveat being that “China is a black box. That’s the big question is, ‘What’s really going on in China?’” Wirth said. With the global benchmark for oil currently hovering near $90 per barrel, China’s dramatic dip in oil exports—by close to 4 million barrels daily—is the biggest reason why prices aren’t much higher. Even though China is transitioning more quickly toward electric vehicles, China has drawn substantially from its world-leading strategic reserves and cut back on fuel exports. So those don’t necessarily portend long-term shifts. In fact, maintaining optimism in the Middle East, Chevron is even planning to invest more in Iraq, including plans to reopen and expand the defunct Kirkuk-to-Baniyas pipeline to the Mediterranean, creating another channel that limits dependence on Hormuz. For Exxon, which is more exposed to Middle Eastern disruptions than Chevron, the temporary loss of its production in Qatar is a key reason its profits fell shy of all-time highs. Excluding the Middle East, Exxon reported its highest oil and gas production volumes in over two decades—shortly after the initial combination of Exxon and Mobil. But Exxon CEO Darren Woods said he’s confident the Middle East’s energy sector will fully rebound—the only question is when—including repairs to its natural gas facilities in Qatar. “Ultimately, the world has to resolve the conflict there and get to a stable situation where those critical resources in the region find a way to the market in a reliable way,” Woods said. “I think there’s a solution that the world will arrive at. I couldn’t tell you when or exactly what it’s going to look like. But those resources are just too critical to the overall economic health of the world for them to stay offline or for them to be unstable.” In the meantime, North America is advantaged with all-time high oil production and growing liquefied natural gas exports. U.S. oil refineries are maximizing their outputs because of huge profit margins from refinery outages around the world—involuntary outages in the Middle East and Russia (from Ukrainian attacks), and voluntary outages in China. Likewise, North American chemical plants are benefiting from their cheap domestic feedstocks—primarily ethane from natural gas liquids—versus the much more expensive, oil-based naphtha feedstocks used throughout Europe and Asia. “They’ve been buoyant to say the least over the last few months,” Wirth said of petrochemical profit margins. At the same time, many have expressed frustration over Big Oil profiting off the war while consumers pay much more to fill their gas tanks and cover the costs of inflation. In a statement from the left-leaning Clean Power group, former Democratic Washington Gov. Jay Inslee said, “Oil and gas companies are pocketing billions from Trump’s war while the consumers pay more at the pump and the grocery store.” He added that “Trump is blocking cheaper, more secure clean energy so consumers have no choice but to pay his donors.” Despite the massive profits, Wall Street wasn’t feeling overly generous on Friday. Chevron’s earnings exceeded expectations, and its stock rose by over 2% to a market cap above $390 billion. However, Exxon’s results were more in-line with estimates, resulting in a 1.5% dip and a market cap just below $650 billion. Still both are trading near all-time highs after hitting stock market records in late March. For now, Exxon and Chevron will keep churning out record volumes of oil from the Permian Basin in West Texas and southeastern New Mexico. About 40% of Exxon’s global oil and gas production is coming just from the Permian to the tune of 1.8 million barrels of oil equivalent daily. Chevron, which pumps out more than 1 million barrels daily in the Permian, is a distant second, representing more than a quarter of its total volumes. The two rivals also are partners in parts of the world, making them forced “frenemies.” Outside of the U.S., Chevron’s largest production output is in Kazakhstan, where Exxon is a minority owner. And Exxon’s largest non-U.S. output is in Guyana, where Chevron is a minority owner after its $53 billion Hess acquisition last year. Both Guyana and Kazakhstan are projecting notably more oil and gas growth in the years ahead. After the Iran war is concluded and Middle Eastern countries begin pumping more oil again, the world could eventually face a temporary glut. But Exxon and Chevron contend more oil sources are needed longer term as existing volumes are depleted, necessitating a new wave of investments in global, frontier oil and gas exploration. That’s why they’re both putting more funding into developing new oil and gas prospects in South America—including the reemergence of Venezuela—as well as West Africa, the Eastern Mediterranean, and other regions. “This is the largest and highest-quality opportunity set that we’ve had in years,” Chevron’s Wirth said. “Probably in my time in this role, we haven’t had this deep an inventory of opportunity.” This story was originally featured on Fortune.com

Image source: The Motley Fool. Thursday, July 30, 2026 at 9:30 a.m. ET Chief Executive Officer - Wael Sawan Chief Financial Officer - Sinead Gorman Operator: Welcome to Shell's Second Quarter 2026 Financial Results Announcement. Shell's CEO, Wael Sawan; and CFO, Sinead Gorman, will present the results, then host a Q&A session. [Operator Instructions] We will now begin the presentation. Wael Sawan: Welcome, everyone, and thank you for joining. Today, Sinead and I will present Shell's Second Quarter 2026 results. In Q2, Shell delivered very strong results, driven by strong operational performance across our businesses. That performance reflects our relentless focus on execution, which enabled us to provide the critical energy our customers needed when it mattered. In Integrated Gas, strong performance across our global portfolio helped to offset some of the lost LNG volumes from Qatar. Take our LNG Canada joint venture, for example. This is a greenfield project that shipped its first cargo just a year ago, and it has already delivered more than 100 cargoes and achieved full capacity this quarter. In Upstream, our continued focus on performance also unlocked additional production this quarter. We continue to optimize and deliver turnarounds ahead of schedule, enabling performance such as in Brazil, where we delivered another quarter of record production. Our Pennsylvania Petrochemicals Complex also delivered its best performance to date, and our refineries achieved a record 102% utilization in a high-margin period. Our refineries have responded to what the market needs, shifting production towards middle distillates like jet fuel, capturing more value from our assets. These kinds of value-based decisions make a difference at a time when global energy flows are under pressure. And behind them sits an important structural strength: Shell's integrated model. The connectivity across our value chains creates the opportunities to optimize assets, product flows and market exposures from well to wheel. And as we remain responsive to the fast-changing conditions, we also have kept a clear focus on delivering our strategy and commitments. Structural cost reductions are progressing well, with $700 million delivered so far in 2026. Savings that are driven by changing the way we work across our organization, including operational efficiencies and a leaner fit-for-purpose corporate center, and the high grading of our portfolio has now delivered savings of close to $6 billion since 2022. We also continue to access long-term growth and strengthen our portfolio. Our acquisition of ARC Resources has won overwhelming support from ARC's shareholders, and we're now awaiting final regulatory approval. The ARC deal accelerates our strategy by sustaining material liquids production and growing our Integrated Gas business, lifting our expected production growth to 2030 from around 1% a year to some 4% compared with 2025. We have also signed contracts to operate the offshore Loran gas field in Venezuela. And in Namibia, we continued to create optionality, having drilled our most promising exploration well to date. At the same time, in Upstream, we have agreed to sell our nonoperated working interest in Na Kika in the Gulf of America, an asset that secured attractive value as it nears the end of its life. Taken together, this is high grading in action, releasing value from assets where we are no longer the natural owner and reinvesting it in the next generation of competitively positioned supply. We also recently announced the divestment of Sprng Energy in India, high-grading our power portfolio. And in Marketing, we completed the divestment of the U.S. Jiffy Lube network and announced the divestment of our South African mobility sites as part of repositioning the portfolio around our key markets. So while performing through today's volatility, we maintained discipline and kept up the momentum on our strategic delivery. And with that, let me hand over to Sinead, who will provide more details on our Q2 financial performance. Sinead Gorman: Thank you, Wael. In Q2, we delivered a very strong set of results. Adjusted earnings for the quarter were $9.8 billion, and we generated over $21 billion of cash flow from operations despite the ongoing disruptions in the Middle East. Strong operational performance across our segments provided the foundation for our delivery this quarter. In addition to this, LNG trading and optimization was able to capture significant additional value compared with last quarter. And I was especially pleased to see the Chemicals results this quarter with a positive free cash flow contribution. The hard work the team is putting into the transformation is starting to pay off, and combined with a more favorable margin environment this quarter's results represents the best we have seen in over 5 years, but there is much more to do. Now turning to our financial framework. Our cash CapEx outlook of $24 billion to $26 billion for 2026 is unchanged. This includes some $4 billion for the ARC Resources acquisition and associated cash CapEx. In Q2, we reduced net debt to some $42 billion, or $12 billion excluding leases. And today, we have announced $3 billion of share buybacks, which we expect to complete by our Q3 results announcement in October. In addition to this new program, we will also complete the portion of the previous buyback program that was halted due to regulatory restrictions associated with the ARC transaction. In summary, this quarter, we performed extremely well despite continued disruptions, we made significant progress across the portfolio, and we further strengthened our balance sheet whilst remaining focused on growing long-term value. And with that, let me hand back to Wael to close. Wael Sawan: Thanks, Sinead. This was a very strong set of results. The macro was supportive, but what these results show more than anything is that Shell delivers through volatility. We continue to drive performance, discipline and simplification throughout the organization as we deliver more value with less emissions. And we are confidently progressing our strategy at pace as we continue to build a more focused, more resilient and higher return company. Thank you. Operator: [Operator Instructions] Wael Sawan: Thank you for joining us today. We hope that after watching this presentation, you've seen how Shell delivered a very strong set of results through the strength of our portfolio and the quality of our execution. Now Sinead and I will be answering your questions. So please, could we have just 1 or 2 questions each so that everyone has the opportunity. And with that, could we take the first question, please, Jake. Operator: Our first caller is Biraj Borkhataria from RBC. Biraj Borkhataria: The first one is just on the distribution front. And going back to your comments in Q1, you cut the buyback -- yes, trimmed the buyback, let's say, the argument you made was you wanted to be agile and tactical. And I guess, just a view on the value of the buyback in terms of your share price. At the same time, you have a payout ratio and that calculus on the return on the buyback is not really embedded in a 40% to 50% payout ratio. So as we look forward, obviously, the impact of the war is maybe more pronounced than you thought at the time. But it looks like your run rate on distributions will be well below the 40% if you continue at this rate. So just trying to understand how you're thinking about squaring those 2 things off, the payout ratio, which you've committed to and then the return on investment of the buyback. And then the second question is just on the low carbon front. I'm noticing the capital employed is obviously steadily reducing. You've announced a few more sales. You've targeted at improving returns in that business. Could you say what proportion of that $15 billion capital employed you have on the books is generating acceptable returns at this point? And I'm thinking beyond the trading that goes into that segment. Wael Sawan: Okay. Sinead, do you want to start with the first one? Maybe I'll go to the second one after that. Sinead Gorman: Happy to. And thanks, Biraj, for the questions. Indeed, so first and foremost, I think it's fair to say that we have both the ability and a commitment to deliver 40% to 50% through the cycle. And we've been very clear on that throughout. This is definitely not about affordability in any sense. You talked about last quarter specifically and what did we do last quarter? So I wouldn't say we trimmed, I'd say we rebalanced. So as we discussed at the time, we rebalanced between both the buyback and the dividends. So we increased the dividends at the time when we moved the buyback to $3 billion. So that allowed us to stay within that payout ratio. We're very pragmatic on this and not dogmatic at all. We are dogmatic about the 40% to 50% through the cycle. But in terms of how we split it, we make that decision quarter-by-quarter, and we look through the quarter. We're not fixated every quarter on that. We're looking at where do we see the macro going to, what do we see in terms of how we can apply, and the funds, the extra free cash flow we have, whether that's to buybacks, whether that's to CapEx or whether that's to the balance sheet each quarter, and we take that decision. You've seen some of the quarters, we've been higher than that, above the 50% as well. So I would say we come back to the fact that it is sacrificing a value decision, but the 40% to 50% is the commitment that we have. Wael Sawan: Thanks, Sinead. Biraj, to the second question, been very pleased with the momentum we have to be able to continue to work on the $45 billion of underperforming capital employed. You touched on a portion of that, which sits in low carbon. I wouldn't divorce, by the way, the trading from the assets. A lot of our low-carbon business models are going to be trading back models. So what you see us doing is divesting assets that don't fit into a trading back capability and making sure that we are gearing all of our activities towards actually that trading back business model. Remember, some of that capital today is sitting unproductively because we are still building up, take CCS, for example, take Holland Hydrogen I in Rotterdam. So this is capital that will start to show a return likely in 2027 onwards. As I've said in the past, we will expect a return on that part of the business to be north of 10% before the end of the decade. And that's what we are working on over the coming years. Again, good progress. There's multiple different levers we're pulling, but we have some way to go. Thanks for the question, Biraj. Operator: Our next caller is Josh Stone from UBS. Joshua Eliot Stone: I wanted to ask about LNG. Very strong results from Integrated Gas this quarter, clearly quite a few moving parts, but also quite a few moving parts from the outlook for LNG. So curious as to what -- how you're thinking if you're thinking differently about the outlook for LNG prices. There was a strong consensus around a glut appearing, but perhaps that's not fair anymore. So curious any comments on LNG. And then related to that, or specifically to your business, are you seeing any change in customer behavior for LNG and Integrated Gas in terms of perhaps customers wanting to sign up to portfolio gas rather than contracting single assets? So if there's any early change in behavior, would be interesting. Wael Sawan: Thanks, Josh. I'll touch a bit on the behaviors, and I don't know if you want to give a perspective, Sinead, on the outlook. Early days, Josh, I think everyone is trying to sort of rewire themselves to the new realities. Qatar will continue to be, of course, a critical part of the overall LNG mix, with 20% of the volumes coming from there. We have not necessarily seen a lot of short-term action as a response of this other than in the spot markets. In the term markets, you continue to see the balance of new U.S. supplies coming into the market, potentially new announcements on FIDs elsewhere. People, of course, anticipating what might happen with LNG Canada Phase 2. All of that means that the market will continue to be well supplied. If I look now long term before coming -- before leaving Sinead to sort of cover the short to medium term, we continue to have very strong conviction, as you saw in our LNG outlook in the future of LNG. We're talking about 65% growth in that market between now and 2050, underpinned by this continued belief that gas will be a stabilizing force in the energy system because of its flexibility, its reliability, the security that it has and the ability to be able to have the adjacencies with the likes of renewables, but also as a substitute to coal or for that matter, heavy fuel oil when it comes to the marine sector. And so the underpinnings are strong. Short-term disruptions, of course, we look to manage through our trading organization. But longer term, we continue to have very deep conviction in that. But the outlook, Sinead? Sinead Gorman: Yes. I think you're talking about the market generically. And of course, when you take out some 25 million tonnes or more out of the market with what's occurred with the Strait, what we've seen of what was considered to be a bit more length was expected within certainly this year, you've taken that out. So that balance has changed. What are we seeing at the moment? We're seeing, of course, where pricing is going to is it's allowing actually some of the volumes to be redirected from where they've been going to, which is Asia, back into Europe, which is much needed as we very much know, because coming into this winter where you've got European volumes are -- sorry, European storage volumes are very limited and actually much below where we would have expected closer to the 50%. We're actually seeing that requirement very strongly here. That redirection is happening, but it does make for a tightness coming in the next quarter or so. Wael Sawan: Thank you, Sinead. Josh, thank you for the questions. Operator: Our next caller is Fergus Neve from Rothschild & Co Redburn. Fergus Neve: Two questions, please. So it was positive to see the recent success of the exploration well in Namibia. I wondered if you could comment briefly on the early differences and similarities between this discovery and the previously written off Graff and Jonker wells that makes this discovery more promising, as you mentioned in your opening remarks. And then secondly, just on the Chemicals result, which was strong this quarter, very positive to see that. Could you just comment on the relative split of this improvement between the self-help work you've been doing since the Singapore divestment and also the margin environment that we saw in the quarter? Wael Sawan: Thanks for that, Fergus. I'll take the first question and ask Sinead to address the second one. On the exploration well, we were indeed pleased with the result of that well. Again, early days. But what I would say is the biggest difference is in both the reservoir and the fluid characteristics. It was one of the best permeabilities, porosities that we had seen in the block, and it's opened up a new horizon for us to explore. We're now looking to expedite 2 appraisal wells to end of this year to be able to allow us to derisk some more volumes and see whether we have enough for an attractive profitable development. So more to come, I suspect, in 2027. Sinead? Sinead Gorman: Thanks, Fergus, for the question. Indeed, great to see Chemicals. The results they showed, the team is doing an amazing job here. And of course, there's 3 things that we're always looking at. We're looking at, as you say, the margins, then we're looking at the ability to actually be competitive and control our costs, and the ability to run the assets really well. Margins, you know as well as I do, how strong those have been this quarter. And of course, those helped significantly. But what the weighting is much more towards the fact of the cost takeout that we've managed and the operating capability of the assets. So what the team did very, very well was to be able to actually ensure that those assets were up and running. So in Pennsylvania at Monaca, they managed to ensure that it actually hit record performance as well. That allows us just to be able to push the product through and be able to actually take advantage of what is very strong margins as well, which gives us confidence as we go through, of course, and what will happen on quarter-on-quarter. Margins will change, but it has to be supplemented by that cost and that operational performance. So well done to the team. Thanks, Fergus. Wael Sawan: Thank you, Sinead. Thanks, Fergus. Operator: Our next caller is Michele Della Vigna from Goldman Sachs. Michele Della Vigna: Congratulations on the very strong results. As you know, there's been a lot of debate around reserve life in the sector. And it feels like FIDs are the biggest way to kind of sort that out and build reserve life for the future. It looks like you're making tremendous progress in a lot of areas. I was wondering specifically on Bonga Southwest and Zabazaba in Nigeria and on LNG Canada too in Canada, whether you could give us a bit of an update on when you expect those FIDs to take place. Wael Sawan: Michele, thank you for the question. Allow me maybe for a moment to be able to sort of frame because I think there's multiple angles to the question that you asked. For the last few years, we've talked about performance discipline simplification with this value over volume focus. And I'm really proud of how far the organization has come over this period. And you can see it in the results. What we have been able to do is, in essence, to be able to strengthen and cement the foundations of our base free cash flow, which has been, if you look over the last few years, roughly $25 billion to $30 billion per year on a $70 real-term basis, right? And we've also been able to extend that. That's been an area we've been very focused on. So extending that stable free cash flow. We have now fully derisked the 2030 period through multiple moves, and we've talked about them in the past. And we are well on our way towards the 2035 period and beyond. So that base, that strong foundation, is very much in place. Now to your point around additional growth, we are now starting to add layers of absolute free cash flow growth. ARC, of course, once it's completed, will add, as we reported last time, roughly $1.5 billion per year. That's additional. LNG Canada Phase 2, provisionally, if we take an FID on that, we'll add the next layer in the 2030s. You asked when that's going to happen. It's likely to be before end of this year is what we are targeting along with the joint venture partners, subject, of course, to all the requisite approvals. And so those layers that we are adding are really shifting us from a free cash flow per share growth, which we have said is our North Star that is maybe more weighted towards the denominator, the buybacks to one that's more balanced with continued preference for buybacks and with continued absolute free cash flow growth in the numerator. And that's the exciting story that we are trying to drive. There are multiple other projects which we are also pursuing. You touched on a couple of them. Bonga Southwest, we are hoping to be able to be in a position to FID in 2027. And Zabazaba, also around '27, '28. And so lots of good momentum going on, and these are the projects that will continue to add those layers above that base free cash flow that I talked about. Hopefully, that allows you to sort of get a bit of a sense of where our mind is on some of these things. Okay. Operator: Our next caller is Doug Leggate from Wolfe Research. Douglas George Blyth Leggate: Wael, I wonder if I could hit 2 things that appear to be taken on a little bit of a life of their own. One is disposals and the other is your cost-cutting target. The disposal momentum seems to have picked up here recently. And I wonder if you could just give us a refresh on what you think that visibility looks like as you monetize perhaps underperforming assets as you've done this last couple of announcements. And then my follow-up is on the $5 billion to $7 billion cost-cutting target. You're about halfway there, 3 years or 2 years early. So I'm wondering if you could frame for us what the risk is that those numbers get reset and any kind of magnitude you could put around that. Wael Sawan: Thank you for that, Doug. I mean -- I think you mean the opportunity to reset them rather than the risk, but I hear where you're going with it. Let me talk about that second point and maybe, Sinead, if you want to touch on the divestment. On the cost-cutting targets, I think, firstly, when I stood here 3 years ago and talked about $2 billion to $3 billion structural cost reduction, it was hard work. We had to sort of try to mobilize the organization and figure out how we can get that. The flywheel started to turn. And we put the next target out there, the 5% to 7%, and indeed, really pleased how all of our business leaders and all of our functional leaders have really responded to the challenge. And the challenge, by the way, is not just a structural cost reduction challenge. It is a free cash flow enhancement challenge. That's what we're trying to drive. Improve reliability, improve availability, enhance business models, turn around underperforming businesses and become leaner, more focused as an organization. So that's been embraced. We are now halfway through that band that we talked about. I continue to be encouraged by what I see, Doug. There's more and more opportunities than maybe we had banked for. And so my push to the team now is we need to be able to get to the top end of this range, and that's what we're working towards. But not only that, we need to keep thinking about what comes next. What are the other ideas? How do we leverage AI in a way that allows us to unlock more value? How do we challenge whether we are running the businesses in the most efficient way, not just against what the benchmarks of today are telling us, but what is going to be the next benchmark and how do we get ahead of the competition there? So this is much more of a culture journey than just a numbers game. And if anything, I'm energized by what I see in the organization around it. Sinead? Sinead Gorman: Thank you, Wael. And Doug, indeed, great question around our divestment program. And again, what I would say with respect to that is probably a couple of years ago, we talked to you about saying we want to be really good stewards of capital. We want to ensure that what we do is we reallocate capital. And that's what I would say we are doing across this company, whether it's around our distributions and back to shareholders or looking at where are we the rightful owners of certain assets or not. We're taking a lens asset by asset and making sure we look at can we extract the maximum value or should somebody else be doing that? We're then taking those proceeds and of course, reallocating those. So what you saw us do this quarter was a number of divestments came through, some of them where they were noncore like Jiffy Lube, which whilst lubricants is an excellent business for us and very strong ROACEs for us in particular, Jiffy Lube was not at the top end of that. So we put it into somebody else's hands, and you see that coming in. Again, in the Downstream, you saw us take the tail of some of our mobility sites that's in South Africa. We've been doing that step by step, and you've heard us talk about Mexico before. So that's just normal progress for us where we're coming out of some of those. And of course, what you saw us do in Upstream as well, liquids is key for us, but there are certain places where we look at can we get a fair price for the asset and who is the rightful owner? So when we look at that in the Gulf of America, we've got a great operator who will take control of it. It's towards end of life and it's a fair price that we get there as well. And then you look at our Renewables portfolio. We've talked before about where do we have capabilities versus others and hence, the exit from Sprng in India as well. That allows us to take those funds and look at how do we reallocate it. And you've seen us reallocate into many areas in Upstream like Ursa in the past in Brazil, but particularly ARC is the one. Now we can't always time correctly the point at which we get a great acquisition that really fits us and divestments. But of course, when we did the deal for ARC, we knew that this divestment program was coming, and you can see that it more than offsets in terms of the cash coming through. So that capital reallocation program is in full swing. There's much more to come on it as well as we continue to hold ourselves to account at a very high bar. And of course, it leads to a ROACE increase over time as well. Thanks, Doug. Wael Sawan: Thank you, Sinead. Thank you, Doug. Operator: Our next caller is Kim Fustier from HSBC. Kim Fustier: I just wanted to ask about the really remarkable operational performance in the Downstream, notably the 102% refinery utilization. I do take [ on board to get ] the range of guidance for 3Q, but maybe more conceptually, how much of this high refinery utilization rate is sustainable? I mean, how long can you continue to operate above 100%, just thinking about maintenance cycles, et cetera? And my second question is on the ARC deal. I see that it's now scheduled to close in the third quarter, subject to remaining regulatory approval. Could you maybe give us an update on the Investment Canada approval? Wael Sawan: You want to start with the second question, straight forward? Sinead Gorman: Yes, happy to. Really short one on this one, Kim. Indeed, we were really thrilled with the answer that came through in terms of the shareholder vote. It was overwhelming in terms of support. We've said it is in Q3. That very much depends on the last approval, which, as you say, is Investment Canada Act. We are investing heavily in Canada, and we believe that, that will be something that comes through quite readily with good discussion with the relevant authority. We can't comment on when that would be. That will be down to their timing, but we're working it very hard at the moment. Wael Sawan: Thanks, Sinead. Kim, the operational performance of Refining has been excellent. But I have to shout out all the businesses. I mean, we have been talking about performance for a very, very long time. And I hope you see now the consistency in the delivery across all the businesses. And when you have an Integrated Gas, for example, Qatari volumes out and you're still getting roughly the same LNG output, it just speaks to the rigor with which the organization is pursuing that performance drive. On Refining, team's done a super job. And there's a few things. Firstly, turnarounds, in particular, safety-related turnarounds, we always pause and do what we need to do. So this is in no way changing turnaround time frames other than if it is not safety critical. And then, of course, we look at the market. I'd say the biggest difference we have seen came over the last year or so. In many people's minds, trading conceptually is traders sitting behind the desk and trying to sort of guess where the market is going. Our trading and optimization is fundamental to Shell and our business model. It is interwoven into every single one of our value chains. And where it is not, we are pushing it further and further. Which is why Andrew Smith, who heads up Trading and Supply, sits on my Executive Committee. So to give you a small example, at Norco in the U.S., we have moved into a model where the traders are tied at the hip with the operators, finding the right feedstock to be able to source given the dynamics in the market at the moment. And then the products traders finding what's the best placement and reading all the price signals to be able to then manage how much do we push into jet fuel versus -- or at the expense of diesel and gasoline, and how do we optimize for value. And so much more of what we see at the moment is that the run rate is being determined by commercial factors driven by our trading organization in partnership with the asset. We are rolling that model out in every single one of our refineries and have tested it and really been pleased with what we see. And so I do continue to believe we are able to deliver performance sustainably. And of course, it will vary quarter-by-quarter depending on where we are on the turnarounds, maintenance schedules. But I have high confidence in our ability to sustain and continue to improve on what we see. Thanks for the questions, Kim. Operator: Our next caller is Nash Cui from Barclays. Naisheng Cui: I have 2, please. The first one is on trading. Just want to follow up because we have seen significant volatility in commodity prices in July. I think earlier, Sinead also mentioned the potential LNG tightness in Q3. I wonder how should we think about trading performance in Q3, please? And then my next question is on CapEx. How confident are we in maintaining the CapEx guidance this year, please? Especially given the disruption in the Middle East. We have heard companies talking about higher cost for -- higher cost to get the rigs FPSO. I wonder what are you seeing in the market right now? Wael Sawan: Nash, thank you for that. I'm going to take the first question on Trading and Supply and then maybe, Sinead, if you want to address CapEx. So firstly, indeed, we have seen that volatility play through in the past quarter. But if I step back for a second, Nash, if you'll have heard me over the last 15 quarters when I've had the privilege to be in these calls, what you'll have heard me say every single quarter is that volatility and uncertainty is what we see in the next quarter. We fundamentally believe that the energy system is inherently becoming more volatile. So rather than worrying about the direction of the volatility, what we are focused on is the things we can control, improving the performance of our assets so that our trading and optimization organization has the molecules. We're driving hard to be able to make sure that the portfolio, the diversity of supply points and the health of the portfolio is one we would like. And of course, continuing to maintain a strong balance sheet to be able to take advantage of opportunities. And so our Trading and Supply. As a company, we are built to be able to handle volatility. I would argue we are the name: if somebody believes in volatility in the energy system, Shell is the name to go after. I'd also argue that we are the name to be able to be the downside price protection in the energy sector, given our Downstream footprint and given our ability to be able to unlock value even in downside volatility. And that's the business model we have built. And so as we look to the coming quarters, what I can tell you is the 2% to 4% ROACE that Trading and Supply is able to deliver continues to hold. And as you would expect, we are at the top end of that range given the current volatility. And if the volatility continues into the third quarter, we expect to continue to be in a healthy part of that range. We don't, of course, guide on particular numbers quarter for quarter and the traders will have to depend on where the market is. But we continue to see that this trading capability, one that others are trying to build, is a truly differentiating feature in our business case. Sinead? Sinead Gorman: And the one add I would have there, Wael, is for Q3, the biggest thing we can do is ensure that the operational performance is strong, that gives the volumes to the trading team to be able to maximize value, whether there's volatility or not, but I agree on the volatility. With respect, actually, you asked, Nash, around our CapEx and are we confident in terms of maintaining the guidance. If you remember, we had a $20 billion to $22 billion per year guidance. And when we did the ARC transaction, we increased that to $24 billion to $26 billion. The reason for that was to cover not only the cash component of the transaction, but also to cover the ongoing CapEx for the rest of the year to ensure we maximize that value from ARC. So our range is $24 billion to $26 billion. We are confident in our ability to be able to deliver within that range, and we continue to maintain that range at the moment. We absolutely see inflation in the system, which is what you're referring to at the moment. That varies per category. But overall, we're seeing it around that 5% to 6%, but we're able to offset much of that given our scale and those framework agreements we have, but also because we have locked in many things because we saw some of this coming as well. So we have confidence in the ability to do that. You asked specifically about rigs. That's less of a problem for us at the moment because we had locked those in, in advance, but we do see indeed what you're seeing of much more pressure in the system around those, as prices are high at the moment. Wael Sawan: In particular, those deepwater rigs. Thank you, Sinead. Operator: Our next caller is Matt Lofting from JPMorgan. Matthew Lofting: My congratulations on strong performance in far from normalized conditions. I'd like to ask you first about Integrated Gas, very strong numbers in the second quarter despite the impact of the Qatari assets. I wondered if you could just expand on the extent to which in conditions you're seeing a degree of natural hedge almost within the business insofar as the downtime or lost volume in the Middle East being mitigated by the rest of the portfolio and perhaps stronger margins as a result that you're able to extract through the rest of that portfolio, particularly the third-party component. And then second, you mentioned earlier the strength of operational performance across the business in the second quarter, very evident. I wanted to ask you specifically about Brazil. I think you highlighted record production in the second quarter. We've seen several strong data points from that hub over the course of the last couple of years. Are your expectations of the midterm oil production that can be extracted from Brazil seeing some upward support? Wael Sawan: Matt, thank you for that. I'll take the second question and Sinead, leave you to the first. I mean I think on Brazil, Matt, specifically, of course, we have an enviable position there, roughly 10% of the overall production in Brazil. The old adage of big fields get bigger, of course, applies in the context of the Tupi fields, the Iracema fields, the Mero fields. And so what continues to happen is that Petrobras, a great operator, continues to look at ways to be able to optimize the facilities and how they do water management, for example, how they are able to shift across their many wells to optimize production and to be able to take advantage of the opportunity right now given where commodity prices are. I don't want to make predictions as to the future, but what I can say is we continue to be very encouraged by what we see in the subsurface and importantly, in the way that Petrobras runs these assets, and we continue to hope we can contribute to support them in doing that. Sinead Gorman: Thank you, Wael. And in terms of the Integrated Gas portfolio, they had an exceptional quarter, I absolutely agree. Given the challenges that they had as well, not only the volatility, but also the fact that they had lost those volumes from the Middle East, a couple of things that played in. Whilst the loss in Qatar had its impact, and it definitely did, the focus was for us in order to be able to manage across the portfolio, as you say. So whether you call it a natural hedge or not, it was a portfolio management approach. So what we saw was, particularly in Nigeria, we saw more volumes coming out of Nigeria, also from Trinidad, but also as Wael mentioned in the video as well earlier on today, specifically around Canada. So we saw LNG Canada come into its own. We're now more than 100 cargoes out from that facility. So what we saw, whilst we were really struggling, having lost the Middle East volumes, we were able to compensate from elsewhere. On top of that, what the team did really well was almost record volumes from third party. So indeed, they went out into the market. They looked at where they could cover and in some cases, buying back some of our own cargoes that we had sold to them to be able to distribute elsewhere, i.e., taking from those customers who weren't as impacted by the Middle East and being able to push them to those who were. That allowed a significant busy compensation from what occurred in Qatar. And beyond that, some price risk management as well, which was very thoughtfully done, given the volatility and the absolute moves we saw throughout the quarter. Wael Sawan: But it's been a tough struggle, lots of headwinds with credit to the team, how they've been able to manage it. Thank you for the questions, Matt. Operator: Our next caller is Mark Wilson from Jefferies. Mark Wilson: There's been a lot of ground covered so far. So let me ask regarding the Middle East assets, yes, obviously, Qatar, but also Pearl GTL. If a normalized shipping environment comes, could you remind us on the time to get those 2 facilities back to their expected capacities, please? Wael Sawan: Yes. Thanks, Mark. Let me separate 3 different assets. So you have Pearl GTL Train 1, same asset, but second train, Pearl GTL Train 2, and then Qatar LNG, which is the other asset that we have in Qatar. The LNG assets are typically easier to start up and to start the shipping out, of course, subject to terminal capacity, subject to storage, subject to shipping availability and the like. The biggest thing we're watching out there for is just access and safe passage through the Straits. Similarly, on one of the trains at Pearl GTL, so Train 2 -- Train 1, where it would actually take in a matter of weeks to be able to get the facility back up and running. That's a facility that hasn't been impacted by the activities by the hostilities in the region. And so within weeks, we could start up that facility. The one that has been damaged, that second train, we expect the repairs, which are now progressing to be completed and for that facility to be ready to go, again, subject to our ability to export by end of the first quarter of next year. So by end of Q1 2027 is when we could expect that facility to be back online, subject to the conditions allowing us to ship out. Hopefully, that gives you a broad sense. Thank you for the question, Mark. Operator: Our next caller is Henry Tarr from Berenberg. Henry Tarr: I had 2. One was just on Venezuela. I think you're looking to push ahead with the Dragon project. I just -- any update there would be great. And then also how you're thinking about managing exposure to Venezuela? And then secondly, clearly, so far in July, it appears as though the Downstream environment continues to be extremely strong. Is that the case that you're seeing that roll through for your refining and chems businesses so far through July? Wael Sawan: Let me start with the first one, Sinead, if you want to touch on the second one. We continue to be pleased with the progress we are making in Venezuela. You touched, Henry, on Dragon, which is one, of course, that we had been working on until the OFAC license was paused and then it has been again, of course, approved again. So we've continued work. We hope to be able to move towards an FID decision at some point in 2027, all going well. We've also recently, of course, been granted the license for Loran Phase 1. That's a 1.7 Tcf opportunity that also could potentially tie back into the Trinidad and Tobago LNG facility, Atlantic LNG. And so the team is currently developing that opportunity. Again, that's an opportunity which we think we can move pretty quickly on because it leverages existing infrastructure we are building in the Manatee development, which again will be starting up in the next 12 to 18 months. And so what you have is a nice cluster of developments, material developments that we hope to be able to bring to first -- to first gas in the coming couple of years. Sinead? Sinead Gorman: Thank you. Indeed, with respect to what are we seeing in this next quarter in Q3, the things that we always look at, of course, are margins, then the volatility and the operational performance. So those are the 3. We've talked before about needing to make sure that, that operational performance plays through, Henry. And what we did have in Q2 was very few turnarounds, particularly in our Downstream business. They were very limited and those that did occur were very quickly done. You see a little bit more happening in Q3. So what are we seeing from a margins perspective specifically there? We're seeing, of course, a positive margin environment for Refining in Q3, but the chemical spreads are beginning to soften. We do see that come through. And we're seeing, of course, less volatility, which means a little bit less coming in, in terms of our Downstream business from the trading angle of things as well. In particular as well, of course, from our lubricants business, it will be a little bit more challenging in this quarter because, of course, it's relying on some of the volumes coming through from Pearl, which we've just discussed, which we're not expecting to see come through in the near term. So the team are having to manage very hard to find alternatives for that and doing so very successfully so far. Wael Sawan: Thanks, Sinead. Henry, thank you for those questions. Operator: Our next caller is James West from Melius Research. James West: Two quick ones from me. One is on the -- with the ARC transaction probably closing soon, you've got your feedstock for Phase 1 of Canada LNG. Does that change your view on the FID of Phase 2 or the scope of Phase 2 and the timing there? And then secondarily, I believe you had a discovery offshore Egypt here in the last couple of days. And I'm wondering if you could give us any kind of early indications of that. Wael Sawan: Yes. Thanks for those, James. I'll touch on both quickly. On Egypt, very early days. What the well has proven is that there's a working petroleum system there. But too early to call as to whether we can find a way to make this a commercial discovery and the follow-up implications. And so the team will be looking through that, but very early days. So nothing to sort of report there. On ARC, Sinead talked about where we are in the process on ARC. I would just sort of say Phase 1, we had already underwritten through our existing acreage from Groundbirch. So we were very comfortable. And we had some spillover also into Phase 2. When we took the decision on the acquisition of ARC, we didn't even put Phase 2 into the base economics. That's upside if we end up taking that final investment decision. And so we will have enough gas to be able to underwrite a second phase if we so choose to take that FID and to be able to continue to create value through other ways as ARC themselves have been doing, creating a premium on AECO. And by leveraging our Trading and Supply organization, we hope to be able to match and improve on that as well going forward. But lots of good work there. And upon completion of that transaction, we're really excited to welcome that ARC Resources family into Shell and really see what more we can do to unlock value and to really demonstrate to our shareholders. It's a big call we have made to be able to use, for example, paper for a good portion of this. We recognize that we need to be able to deliver returns on it. We have already -- we see line of sight to double-digit returns. But I do expect my teams to aspire to meet mid-double-digit returns if we can and really demonstrate the value that we can create whenever we choose to use paper. And so really exciting days ahead there. Operator: Our next caller is Jason Gabelman from TD Cowen. Jason Gabelman: You guys released your annual LNG presentation earlier, but you didn't have the typical webinar that you have with it. So I was wondering if I could just get your perspectives on the LNG outlook. And specifically, it looks like you're calling for perhaps a bit more of a balanced to oversupplied market into the early 2030s compared to a previous view that maybe the market should be balanced to undersupplied by then. So what has changed? And does that inform how you pace your investments in new LNG plants? Wael Sawan: I'll say a couple of words, and then please, Sinead, add if you want to as well. Indeed, we did not this time, add a webinar, which we typically have done, and we actually delayed the issuance of the outlook because it was in the midst of the start of hostilities in the Middle East. And given how many people in the Middle East were involved in the preparation of this, we chose to pause and then just issue it without the webinar. But long story short, as I said earlier, the -- we reaffirmed long-term conviction about 2050 and the 65% growth. I think the biggest thing that we also wanted to point to in the LNG outlook is just how incredibly resilient the LNG market has shown itself to be. Remember, at a time when some 20% of supplies were constrained because of the blockages in the Straits, customers continue to get LNG. And so that's a key piece of the overall puzzle. So we anticipate, as per the LNG outlook, around 180 million tonnes of new annual supply to be coming into the market by 2030, which, of course, continues to strengthen that market. But on the demand side, there's significant growth that we are seeing in multiple areas. We're seeing it in areas like transportation, maybe more so than we had predicted a few years ago. And we continue to see the adjacency that it plays into the power and particular into renewables. The biggest growth we continue to see is in Southeast Asia, in particular, countries that already depend on gas -- indigenous gas, where they are starting to mature those fields, and they need to import and leverage the existing gas infrastructure that they have in their countries. And of course, Europe continues to be a big draw on LNG coming forward. So all of that continues to play up, Jason, in our views. And no one can predict when the tightness is going to happen, but short-term disruptions are inevitable in any commodity market. The long-term outlook continues to be very, very solid. Is there anything, Sinead, that I missed? Sinead Gorman: No. Thank you. Wael Sawan: Good. All right. Thank you. Thanks for the question, Jason. Operator: Our next caller is Christopher Kuplent from Bank of America. Christopher Kuplent: Wael, I've got one question for you. Maybe you can give us a little bit of an insight into how busy your M&A team is these days. The ARC deal is about to close. Are you telling them, please don't show me any more ideas because I'm busy enough integrating ARC. Apologies, it's been a while that I've spent my time working for M&A bankers. So just a bit of color on how busy you are these days, considering how many deals you must be being shown at least. And then if I may, Sinead, 2 very quick ones. I'll dare ask you 2. Firstly, there has been a considerable lag in terms of cash tax payments versus the P&L in the first half. Do you expect any of that to persist or get recovered into the second half of 2027? And then maybe briefly again on the famous payout ratio. I hope you'll agree, see whether I'm putting words in your mouth that 40% in a very high absolute cash flow world is the countercyclical thing to do when it comes to the full year data when we have another 2 quarters under our belt. Wael Sawan: Christopher, thank you for those questions. I'll start with the M&A one and then leave Sinead to address the others. I think the first thing I've been saying to the team is thank you for the terrific job that they have done on ARC Resources. We're not done yet. But I think the -- this was, as I've said in the past, a deal we had been looking at for a couple of years. And when the stars aligned, we really moved. So I was really proud with how they've moved on that. Then Christopher, maybe back to what I said earlier. So I talked about how we had strengthened that free cash flow foundation, the base that we have, the $25 billion to $30 billion, and ARC having been sort of additive and potentially LNG Canada Phase 2 being additive. So I'm very comfortable with where we are on our growth trajectories at the moment. We are not constrained, but we will continue to be disciplined. We have always said we will be disciplined. We've always said we will hold ourselves to a high bar when it comes to M&A. And while, of course, we always look at multiple opportunities, what I can tell you is nothing at the moment that I have seen comes close to ARC Resources. And so that high bar will continue to play in our minds, and we'll continue to see where the opportunities emerge. If I'm to diagnose where the market is at the moment, it's clearly more of a seller's market when it comes to oil. So very little in terms of opportunity space there. But there are pockets where it might be a buyer's market, and we've looked at those. But as I said, nothing that is meeting the threshold that ARC was at. And therefore, we continue to focus on what it is that we can do, and that's to grow the fundamental free cash flow through the levers we have. Sinead? Sinead Gorman: Thank you. Wael, indeed, and 2 slightly different ones, as you say, Christopher. On the first one in terms of the lag in cash tax payments, nothing too much on this one. It really is just the timing of when the mismatch between when you actually earn it and then when you pay it and just the timing with the payment dates set by government. So nothing really within our own control. It really is driven by their side of things. You typically see it a little bit higher, of course, in Q1 and Q4 versus Q2 and Q3. Of course, it shows up quite significantly when you're sitting on free cash flow this quarter of some $17 billion in 1 quarter. So that's where you see it start to pull out. And your point on payout ratio in terms of being countercyclical, you know I'm never going to guide on anything. But indeed, the 40% to 50% is what we said is definitely sacrosanct. And from our perspective, yes, we have high conviction in share buybacks, and we continue to do so. But we do focus on value. As you know, it's about value, not about affordability in this case. And you've seen the way we've acted in the past. So we're always very confident in doing our buybacks when the time is right. Wael Sawan: Thanks, Sinead. Operator: Our final caller is from Maurizio Carulli from Quilter Cheviot. Maurizio Carulli: Congratulations for the excellent results, first of all. I have 2 questions, if I may. One probably for Wael and the other one for Sinead. For Wael, is there a case for modifying in the future the design of facilities in riskier countries like in the Middle East, so that they become more protected from physical attacks and if hit, more resilient to an easier and quicker restart of operations? And for Sinead, Shell has been historically one of the best, if not probably the best company in terms of thoroughness of financial reporting. And is there a case there for providing a bit more of detail within the financial reporting about your trading activities, particularly given that they are properly backed by assets, therefore, it's something more structural rather than what would be a trading activity of a financial institution? Wael Sawan: Super, Maurizio, thank you. I'll take the first one. I loved how you approached the second one, congratulating and complimenting Sinead and then going after the jugular on trading. So I will leave her to address that one. On modifying facilities, difficult one, Maurizio. I think the reality is with the emerging technology these days, there is no foolproof full protection. The biggest thing we can do from a company perspective is to continue to indeed add whatever layers of security we can add. And we need to continue to diversify the sources of supply in our portfolio because as we have seen, whether it's arteries getting clogged, whether it is countries involved in hostilities, there is no singular way to be able to totally sort of protect these assets. But we will continue to operate as we do in very close coordination with many of the countries in which we operate to be able to protect these assets to the best of our abilities. I'd say the second big piece that we are very focused on as a company is also cyber defense. Because physical is one approach. The cyber is the other one. And we have some very, very focused efforts across the company to continue to keep up with the evolving cyber landscape and making sure that we protect our assets from an OT perspective where we can. And so that is the nature of the world we are in, and it goes back to my earlier point, we continue to see the energy system of the future being more volatile. And this is why we want to continue to be the name that can capture that upside volatility and that can protect to the downside, and that's what we can offer our shareholders. Sinead? Sinead Gorman: Thank you, Maurizio. I always love a compliment, so thank you very much for that. I would say we often get told that our reporting is almost too thorough, that we give too much information that makes our annual report quite a tome to go through as well. But in all seriousness around it, we are trying to make sure that we give you as much transparency as possible or give our investors as much transparency so that they can understand fully the value of this company. What we do, of course, is for us, trading is actually much more around being able to optimize around the assets of the various businesses. So it is not a segment in its own right. It is the other businesses that it pulls on for the volumes, et cetera. We allocate capital to those segments rather than specifically to trading as well, and that's why we report it in the manner we do. We're trying to give you a bit more information around that. We've told you as an example, that we've never lost money in any quarter in the last decade, as we said in our Capital Markets Day 2025. And giving you that feel, as Wael talked about earlier, that in terms of that uplift to our ROACE of 2% to 4% in times like this where we've got a lot of volatility, trading does play out stronger and is able to utilize those volumes, and therefore, we're at the upper level of that 4%. We're looking to give you a bit more detail on our next Capital Markets event, which we're hoping will be at some point in the first half of 2027. So we'll go into a bit more detail then as well. But thanks for the question. Wael Sawan: Thank you, Sinead. Thank you, Maurizio, and thank you for all your questions and for joining the call. In conclusion, we delivered a very strong set of financial results in the second quarter, supported by another quarter of strong operational performance across all the businesses. We remain focused on executing our strategy, on transforming our portfolio and on delivering on our key targets. We wish everyone a pleasant end of the week. And for those going on leave, a well-deserved rest. Thank you, everyone. Before you buy stock in Shell Plc, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Shell Plc wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,081!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,166,221!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of July 30, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Shell (SHEL) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Release Date: July 31, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Clariant AG (CLZNY) delivered strong Q2 results with an 80 basis point year-on-year increase in EBITDA margin to 18.2%, driven by robust pricing and volume growth in care chemicals. The company achieved a 15 percentage point improvement in free cash flow conversion to 52% on a last 12-month basis, reflecting effective working capital management and disciplined capital spending. Clariant AG (CLZNY) secured a major legal victory as the Amsterdam District Court dismissed Shell's ethylene damage claim in its entirety, removing a significant overhang on the company's share price. The company increased its performance improvement program savings target by CHF20 million to CHF100 million by 2027, with CHF90 million expected by the end of 2026, supporting profitability. Despite the Middle East conflict, Clariant AG (CLZNY) successfully implemented 3% price increases across all business units, offsetting inflationary raw material costs and demonstrating pricing power. The company saw strong growth in high-margin segments, with care chemicals growing 4.2% in local currency (excluding portfolio pruning) and adsorbents and additives growing 5.3%, driven by innovative applications like flame retardants for data centers. Clariant AG (CLZNY)'s catalyst business was severely impacted by the Middle East conflict, with volumes declining 14.2% year-on-year, leading to a 32.5% drop in EBITDA for that segment. The company experienced a 2.4% currency headwind in Q2 and a 4.9% negative currency translation impact in the first half of 2026, reducing reported sales. Group EBITDA before exceptional items decreased by 7.7% in the first half of 2026, with the margin declining 30 basis points to 17.8% due to the Middle East impact on catalysts. Net debt increased by CHF79.2 million versus the end of 2025, pushing the net debt to EBITDA ratio up to 2.2 times from 2.0 times. The Middle East conflict led to a peak of over 100 force majeure events globally in the sector during Q2, with ongoing order delays and supply chain disruptions expected to persist, particularly in the Middle East. The company incurred CHF24 million in restructuring charges in Q2 due to additional headcount reductions of around 110 positions, part of a total announced reduction of 640 positions. Warning! GuruFocus has detected 5 Warning Signs with CLZNY. Is CLZNY fairly valued? Test your thesis with our free DCF calculator. Q: The dismissal of the Shell ethylene claim is clearly good news. Does this offer positive read-across to the other claims, and does it largely remove the risk of the other Dutch court claims (e.g., from Tartar, OMV) that use the same methodology? Can you also provide an update on the BASF claim in Munich?A: Konrad Kaiser (CEO): This is a big step forward for the company. Almost half of the remaining cases will be served in the Netherlands, and the methodology used in those cases is very similar to the Shell case, with the vast majority referencing the same economic reports (the Alex and Partners report) that the court found failed to demonstrate causality. While we prefer not to comment on individual cases like BASF, the cases in German courts also use a similar methodology and facts. Even though German courts are not bound by Dutch decisions, the win in the Netherlands positions us quite strongly for the cases to come. Q: You mentioned customer pre-buying in Consumer Care. Which end markets were affected, and do you see a risk that Q3 volumes could be negatively impacted as a result of demand being pulled forward?A: Konrad Kaiser (CEO): We saw very limited pre-buying. Where we did see some was in our cosmetics business with unique active ingredients, driven by heightened supply chain security concerns. However, the large-scale pre-buying seen in the past from home care customers speculating on higher raw material prices did not happen this time. Inventory levels are fairly normal and average across the segments. Q: Your agricultural business within Consumer Care was weaker. How much of that is share wins from generic manufacturers versus the innovators like Syngenta or Bayer?A: Oliver Ritkin (CFO): The majority of our customers are in the branded businesses, so the current performance is not so much affected by the generic play. The Q2 performance is trading over a very strong prior year quarter (Q2 '25 was mid-20s growth). After that restocking last year, you see a softer volume quarter this year. We expect growth to come back in the remainder of the year driven by the branded players. Q: The midpoint of your guidance points to a 5% improvement sequentially in H2. How confident are you in achieving this, and what are the assumptions by division?A: Konrad Kaiser (CEO): We are quite confident. We see a pickup in the second half, especially in Catalyst, which was hit hard in Q2 (minus 13%). We expect an easing in force majeures, especially outside the Middle East. In Chemicals, we will continue to see positive performance underpinned by pricing over 3%, with an additional wave to come from formula-based pricing. A&A has interesting pockets of growth, such as flame retardants for data centers and renewable oils for bio-diesel and sustainable aviation fuel. Q: You mentioned on TV that the lawsuit outcome gives you more strategic flexibility. Can you elaborate on what you mean by this and how it changes your thinking on consolidation?A: Konrad Kaiser (CEO): The positive reaction reflects that there was an overhang on our share price from these cases. However, this overhang never impacted our ability to finance acquisitions or our operational performance. There is no change in our strategy: it is first and foremost about organic growth, then bolt-on acquisitions to strengthen core segments, like the Lucas Meyer example. We remain disciplined and focused on tangible synergies. Q: Can you provide an update on the number of force majeures (outages) due to the Middle East situation? At Q1, you gave a figure of 88.A: Konrad Kaiser (CEO): During Q2, the number went up, and at one point in May/June, we were well above 100 force majeures globally in the sector. Looking at the July number, we are now below 100. We see an easing outside the Middle East, with companies in China, Japan, Korea, and India back up and running. In the Middle East, we still see a significant number of customers in shutdown, and we expect that to take a bit longer to ease. Q: What was the benefit from inventory revaluation gains in Care Chemicals in Q2, and how should we model Q3 versus Q2?A: Oliver Ritkin (CFO): Looking at the Q1/Q2 dynamics, we had a negative effect in Q1 and a positive one in Q2. For the first half for Care Chemicals, we are talking about an effect of less than 100 basis points on margin. As we go into the remainder of the year, the curve is flattening out. Konrad Kaiser (CEO): On phasing, there is nothing unusual this year. Catalyst typically has a stronger second half, and we are confident the second half will be slightly better in terms of revenue compared to H1. Q: You increased your savings target by CHF20 million. Can you provide more detail on the one-off costs and how they develop in the rest of the year?A: Oliver Ritkin (CFO): The majority of the one-time costs for the upgraded CHF20 million program have been booked in the second quarter. We are talking about a mid-single-digit number for the remainder of the year in general for restructuring. The biggest part is behind us in the first half. Q: Looking at your innovation portfolio, what are the major differences in demand for new catalysts in Asia versus Europe and the US? How do you see the mix evolving in 2027-2028 given the Middle East conflict?A: Konrad Kaiser (CEO): In China, there is a clear shift back to coal-based chemistry via the methanol-to-olefins route, where we provide catalysts that improve the carbon footprint. At the same time, there is a continued commitment to sustainability targets, with investments in green hydrogen, green methanol, and green ammonia plants at a much larger scale than Europe. We are extremely well positioned with our syngas catalysts for these new plants. Q: Do you have any indication as to whether Shell is likely to appeal the ruling, and should investors view that case as effectively closed?A: Konrad Kaiser (CEO): Both the Shell case and the separate case from the Foundation for Ethylene Claims can be appealed, and the appeal needs to be brought forward within about three months from the day of the decision. We cannot comment on whether Shell will appeal, and I have no knowledge on that. For the complete transcript of the earnings call, please refer to the full earnings call transcript.