Shell reports strong Q2 trading gains amid East volatility

Shell Plc delivered a strong oil and gas trading performance in the second quarter, benefiting from market volatility caused by the conflict in the Middle East, the company said in a trading update on Tuesday. While its overall natural gas production is expected to fall sharply due to disruptions in Qatar, robust trading profits and improved refining margins are helping to offset the operational impact.

The London-based energy giant stated that its oil trading profits for the April-to-June period were in line with a strong first quarter, while its gas trading results were significantly higher. The company’s chemicals and products unit, which houses its major oil trading desk, is also expected to match its previous quarter’s performance. These trading operations have capitalized on price swings stemming from the conflict, which began in late February and initially caused crude prices to spike above $120 a barrel before retreating to around $73 after an interim peace deal was signed last month.

Despite the trading gains, Shell’s integrated gas production is forecast to drop by approximately 30% compared to the first quarter. The company now expects output between 610,000 and...