Oil multinationals: High oil prices cause profit jumps at Shell & Co.

Rising oil and gas prices due to the Iran war have led to increased profits for major oil companies like Total, Shell, and Repsol. Total reported a surge in profits, and shareholders may benefit from share buybacks. The companies' stocks rose on Thursday. Shell doubled its adjusted profit in the third quarter compared to the previous year, reaching 10.8 billion dollars, surpassing analyst expectations.

Total's adjusted net profit more than doubled yearly, reaching nearly 9 billion dollars. Repsol also saw a significant increase in its adjusted profit. The conflict in the Middle East has disrupted tanker traffic in the Strait of Hormuz, driving up oil prices. Brent oil averaged over 90 US dollars per barrel in the third quarter, currently at around 113 dollars.

Shell and its competitors have been operating their refineries intensively over the past months to maximize earnings. Additional revenue from trading and refining operations greatly outweighed the difficulties in supply and production. Expected profits from liquefied natural gas deliveries from the Persian Gulf also contributed to unexpected gains for the major energy companies.

Despite facing production losses in the Middle East, oil multinationals are multiplying profits. Shell's profit in the third quarter more than doubled compared to the previous year, reaching 10.8 billion dollars. Total's profit increased by more than double yearly, reaching nearly 9 billion dollars. Repsol's adjusted profit doubled to around 2.7 billion euros.

The Spanish company announced its third share buyback program this year, purchasing an additional 950 million euros in shares. Shell announced share buybacks of five billion dollars, two billion more than the previous quarter. Total plans to buy back shares worth 2.5 billion dollars in the final quarter and the first quarter of 2027.

Share buybacks can increase the value of remaining shares when acquired shares are redeemed, raising the earnings per share. Green and left-wing parties are again calling for a profit tax on major oil companies. The increased oil and diesel prices, along with the high company profits, are sparking political debates. The German government is being called upon to take further measures beyond the fuel discount.

SPD Finance Minister Lars Klingbeil criticized the oil giants for again reaping record profits while citizens suffer from high fuel prices and the consequences of climate change. He accused them of pocketing additional tax money through his ineffective fuel discount. Greenpeace activists demonstrated at a Shell fuel station in Hamburg, criticizing the companies for "pressing down prices" and demanding a profit tax.