Oil drops back below $100 a barrel again
The Brent crude oil price is declining this morning, approaching the two-week lows recorded yesterday.
Brent crude is down approximately 3% at $98.30 per barrel, falling below the $100 mark following US President Donald Trump’s statement that it is “very possible” a peace deal will be reached.
Oil prices fell sharply on Wednesday as markets factored in a reduced risk of prolonged disruption in the Strait of Hormuz. This followed reports that the US sent a one-page proposal through Pakistan aimed at ending the conflict and gradually reopening the waterway. Iran is expected to respond in the coming days, with nuclear talks likely to follow.
However, it remains unclear whether Trump has secured a resolution to the conflict, with his latest proposal described as an “American wishlist, not a reality” by the spokesperson for the Iranian parliament’s national security and foreign policy commission.
The Danish shipping giant Maersk has maintained its profit guidance for the year despite reporting a spike in fuel costs and warning that traffic through the Strait of Hormuz “remains at a near standstill.”
The company, which transports goods globally via sea, road, rail, and air, noted that demand for shipping containers remains strong, but the Middle East conflict is increasing costs.
“The reopening of the strait of Hormuz, whether it happens in the days to come or the months to come, will have limited impact on cargo flows. What really are the most important factors to consider: first is our ability to mitigate the cost increases we have been suddenly faced with. And I would say so far we have been successful with both our cost measures and the revenue, the commercial measures that we have put in place to mitigate the impact of these increases to our financials.”
Chief Executive Vincent Clerc told that the reopening of the strait—a critical shipping channel through which a fifth of the world’s oil and gas normally passes—would have a limited impact on cargo flows given the cost pressures the industry is facing.
Fuel costs have nearly doubled since the start of the conflict, implying an additional $500 million in costs per month, although the company has been able to offset this through price increases.
“The secondary effect from this is actually whether these increased costs are eventually going to lead to inflation and demand destruction as a result, which could create a softened market environment in the second half of the year.”
Shares in Maersk, listed in Copenhagen, are down 4% this morning.
Greenpeace has calculated that Shell made $53,241 per minute in profit during the last quarter.
New closing high on the Nikkei
Japan’s Nikkei 225 stock index closed today at a new record high.
The Nikkei surged over 5.5% to close at 62,833 points, marking a 24% increase so far this year.
Markets across the Asia-Pacific region rose, with senior equity analyst at Hargreaves Lansdown commenting:
“Global markets are still pricing the glass as half full, with yesterday delivering another strong rally despite little tangible progress towards a lasting resolution in the Middle East.”
Shell’s shareholders are set to benefit further.
The company is increasing its quarterly dividend to $0.3906 per share, up from $0.3580 in the first quarter of 2025. It also announced a new $3 billion share buyback program, another method of returning cash to investors.
This follows a profitable quarter for shareholders, with Shell distributing $5.3 billion in the first three months of 2026—$3.2 billion in share buybacks and $2.1 billion in dividends.
However, Shell’s Q1 dividend remains below pre-pandemic levels.
Mark van Baal, CEO of the Follow This campaign, stated:
“These windfall profits are the result of war, not strategy. The underlying business model remains untenable as fossil fuel demand will enter structural decline soon. If Shell can’t restore its dividend to pre-Covid level with the oil price above $100, how will the company create shareholder value when demand declines and the oil price drops?”
Centrica buys Severn gas power plant
In other energy sector news, British Gas owner Centrica has agreed to purchase the Severn gas power plant in South Wales for approximately £370 million, nearly six years after its previous owner went bankrupt.
Centrica described the acquisition as one of the most efficient gas plants in the UK, stating it will play “a critical role” in stabilizing the UK’s electricity system.
The company agreed to buy the plant from Calon Energy, which entered administration in 2020. Calon’s directors regained control of the Severn and Sutton Bridge gas plants in 2021 to maintain operations while a sale was arranged.
Severn is among the few UK gas plants capable of rapidly increasing power output to compensate for fluctuations in renewable electricity generation or unplanned outages.
Centrica CEO Chris O’Shea commented:
“The importance of reliable, flexible generation to balance the system continues to increase, keeping energy supplies secure and affordable as the energy transition progresses. Severn will play an important role in supporting that journey. With the delivery of replacement capacity being impacted by grid access, rising costs and supply chain constraints, alongside the closure of aging gas assets towards the end of the decade, the need for assets like Severn will increase.”
Shell: repairing Qatar LNG plant will take a year
Shell’s profits have increased despite production shutdowns and export constraints caused by the Middle East conflict and the closure of the Strait of Hormuz.
In March, production at Shell’s Pearl gas-to-liquids (GTL) facility in Qatar was halted following an attack on Ras Laffan Industrial City.
Shell now indicates that repairing the damage to the Pearl ‘train’—a compressor used to convert natural gas into liquefied natural gas (LNG)—could take around one year.
“On March 18, 2026, an attack on Ras Laffan Industrial City (Qatar) damaged one of the two trains at the Pearl GTL facility, resulting in a limited write‑off recognised within depreciation in the first quarter 2026. It is currently anticipated that the full repair of the damaged train will take around one year.”
Anger over Shell's 'monstrous' profits
Danny Gross, climate campaigner at Friends of the Earth, described Shell’s profits as “indefensible” following the company’s latest financial results.
“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. Our fossil fuel-reliant energy system siphons money away from ordinary people to the rich and powerful. 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. This would lower energy bills, strengthen the UK’s energy security and protect us all from future energy price spikes.”
Maja Darlington, climate campaigner for Greenpeace UK, criticized the fossil fuel economy as rigged in favor of oil giants like Shell.
“In the twenty-first century we have cheaper, cleaner alternatives that we can use to power Britain without anybody being bombed. We don’t need to let the fossil fuel industry hold us to ransom and pass on the costs of endless wars and limitless pollution. The cost of living crisis, the climate crisis, the Middle East crisis, these are all oil industry operating costs. We need to stop subsidising them, introduce new taxes to make them pay and start taxing their obscene profits properly.”
Shell's profits more than double quarter-on-quarter
Shell has reported soaring profits since the Iran war began, surpassing City forecasts with $6.9 billion in profits for the first quarter of 2026. This period saw increased oil and gas prices and significant volatility in energy markets.
This represents an increase from $3.256 billion in the last quarter of 2025, a period typically characterized by lower energy sector activity and profits. It also marks a sharp rise compared to $5.577 billion earned in the first quarter of 2025.
Shell attributes the earnings increase to its trading division, higher prices, and improved profit margins in its refining business.
“Adjusted Earnings, compared with the fourth quarter 2025, reflected higher contributions from trading and optimisation mainly impacting our Downstream, Renewables and Energy Solutions businesses, higher realised prices, higher refining margins, lower operating expenses and higher Lubricants margins, partly offset by lower volumes.”
This surge in earnings is expected to renew calls for a new windfall tax on the sector.
Anne Jellema, executive director of climate campaign group 350.org, stated:
“While people around the world struggle with soaring energy costs, Shell is raking in billions in added profit. The same crisis that is driving these windfalls is pushing millions closer to hunger and hardship. Governments must act now to tax these excess profits and use the money to protect vulnerable households and expand affordable, homegrown renewable energy.”
Iran deal optimism lifts markets
Global stock markets continue to rally as investors remain hopeful of a deal to end the Iran war.
Asia-Pacific markets have surged following strong gains in Europe and the US yesterday, driven by signs of progress in US-Iran negotiations.
Shares rose after US President Donald Trump stated that a deal with Iran to end the war was “very possible” following “very good talks” over the past 24 hours.
Japan’s Nikkei 225 index increased by 5.7% today as trading resumed after the extended Golden Week holidays. South Korea’s KOSPI index rose 1.4%, and Australia’s S&P/ASX gained 1%.
Iran is currently reviewing a US peace proposal after Trump warned Tehran to accept a deal to end the war or face a new wave of US bombing.
Yesterday, the FTSE 100 surged by nearly 220 points, or 2.15%, to 10,438 points, while on Wall Street the S&P 500 reached a record high.
Oil prices plunged, ending yesterday almost 8% lower.
Stephen Innes, managing partner at SPI Asset Management, noted:
“The market traded like a casino where the fire alarm suddenly stopped ringing just as the champagne carts rolled back onto the floor. The S&P 500 and the Nasdaq Composite surged to fresh all-time highs, but truth be told, this was not merely an American rally. It was a full-blown global melt-up as traders aggressively embraced the idea that the Iran war may finally be shifting from missile trajectories to negotiation tables.”
The agenda
- 8am BST: Riksbank interest rate decision
- 9am BST: Norges Bank interest rate decision
- 9.30am BST: UK construction PMI
- 12.30pm BST: US Challenger job cuts
