By Nana Karikari, Senior Global Affairs Correspondent
British energy giant Shell joined its industry peers this week in reporting a significant surge in quarterly earnings. Global energy markets remain volatile following the start of the conflict between the United States, Israel, and Iran. This geopolitical instability has driven crude prices higher and disrupted critical supply chains.
Shell posted adjusted earnings of $6.92 billion (GH₵77.85 billion) for the first three months of the year. This figure comfortably surpassed analyst expectations of $6.1 billion (GH₵68.63 billion). The result marks a notable increase from the $5.58 billion (GH₵62.78 billion) reported during the same period last year. It also represents a sharp recovery from the $3.26 billion (GH₵36.68 billion) earned in the final quarter of 2025. The surge follows similar “bumper results” across the sector. Rival BP saw profits more than double, while Norway’s Equinor hit a three-year high of $9.77 billion (GH₵109.91 billion).
Market Disruption Drives Financial Gains
The conflict has transformed global energy security. The Strait of Hormuz remains effectively closed to standard traffic. This maritime corridor typically handles approximately 20% of the world’s oil and liquid natural gas supplies.
“Shell delivered strong results enabled by our relentless focus on operational performance in a quarter marked by unprecedented disruption in global energy markets,” stated Shell CEO Wael Sawan. “The safety of our people remains our priority as we work closely with governments and customers to address their energy needs.”
The International Energy Agency has characterized the current situation as the most significant energy security threat in history. Brent crude prices have fluctuated wildly as a result. Prices peaked above $120 (GH₵1,350) a barrel before stabilizing near $101 (GH₵1,136).
Local Impact and Ghana’s Economic Response
While global giants report record earnings, the impact on the ground in Africa remains a primary concern for policymakers. In Ghana, the National Petroleum Authority (NPA) recently announced fuel price adjustments for May 2026 to cushion the effect of these global surges. Petrol is currently pegged at GH₵13.25 per litre, while diesel saw a reduction to GH₵14.30 per litre following a peak of GH₵17.10 (approx. $1.52) in April. Government officials have moved to remove certain tax margins and distribute free fertilizer to farmers to prevent a cost-of-living crisis driven by “imported inflation.”
Trading Success and Refining Margins
Market volatility has benefited Shell’s internal trading division. Large price swings allow traders to capitalize on the widening gap between buying and selling costs. Refining margins also improved as the company processed crude into high-demand products like petrol and jet fuel.
Despite the profit jump, Shell faced operational setbacks. Conflict-related damage struck the Pearl GTL site in Qatar. Regional violence also forced a shutdown of LNG production in the area. Total oil and gas output fell by 4% compared to the previous quarter.
Strategic Expansion and Debt Levels
Shell is looking toward long-term growth through North American assets. The company recently announced a $16.4 billion (GH₵184.50 billion) acquisition of Canadian producer ARC Resources. Wael Sawan noted this deal would “deliver value for decades to come.” He described the firm as a “high-quality, low-cost and top quartile low carbon intensity producer.”
However, Shell’s net debt rose to $52.6 billion (GH₵591.75 billion) this quarter, up from $45.7 billion (GH₵514.13 billion) at the end of last year. Maurizio Carulli, equity research analyst at Quilter Cheviot, told reporters that “net debt is probably the only minor negative.” He explained the increase is “mainly because of the working capital effect” where rising oil prices increase inventory value. In response to the earnings, Shell increased its dividend by 5% to $0.3906 (GH₵4.39) per share but slowed its share buyback program to $3 billion (GH₵33.75 billion).
Intensifying Calls for Windfall Taxes
The “monstrous profits” reported by energy firms have sparked a political backlash. Climate advocates argue that corporations are benefiting from consumer hardship. Danny Gross, a campaigner at Friends of the Earth, criticized the trend.
“Once again, fossil fuel giants are pocketing monstrous profits while drivers are being squeezed at the petrol pump and households are set to pay higher energy bills,” Gross said. “The answer is clear: strengthen the windfall tax on these indefensible profits and break our dependence on fossil fuels by powering our economy with homegrown renewables.”
The existing UK Energy Profits Levy primarily targets domestic extraction. Shell generates less than 5% of its production within British borders. While the current energy price cap in the UK keeps typical annual bills at £1,641 until June, experts warn global pressures will likely force retail costs higher in the coming months.
Supply Chain Pressures and Inflationary Risks
Rising energy costs are cascading through the global economy. Shipping leader Maersk is currently passing these expenses to its clients. CEO Vincent Clerc told the media that energy spikes add $500 million (GH₵5.63 billion) in monthly costs to their operations.
“What is really important is actually to pass on these cost increases to our customers as much as possible, so that we can protect our margin and the operations’ integrity going forward,” Clerc said. Evidence of the escalating risk was seen recently when the US-flagged Alliance Fairfax required US military assets to safely exit the Strait.
Consequently, the industry remains in a state of high-stakes transition. While corporations navigate unprecedented margins, African economies are recalibrating to ensure energy security. Whether the Strait of Hormuz will see a permanent shift toward toll-based access or return to open transit remains, in the words of Vincent Clerc, “very, very speculative” until the conflict subsides.
