EL7 Research · Energy
29 October 2026 · European oil companies’ Q3 results
Brent averaged $97.0 in Q3, yet earnings at Shell, TotalEnergies and Repsol surged as refining margins more than doubled. This report examines where the profit came from, how much went back to shareholders, how much paid down debt, and why Q4 starts from a higher base.
A jump driven by more than crude: Between 23 and 29 October, Europe’s largest oil companies reported substantial earnings increases over Q2. Shell’s adjusted earnings reached about $10.8 billion, while adjusted net income reached about $9.1 billion at TotalEnergies and €2.7 billion at Repsol. Both measures exclude non-recurring items and the impact of inventory valuation changes. Yet Dated Brent, the price of physical North Sea crude cargoes, averaged $97.0 per barrel in Q3, below the Q2 average of $103.8. Crude prices fell, while earnings rose.
Refineries drove the increase: The refining margin (Refining Margin / Crack Spread), the difference between the price of refined products, such as petrol and diesel, and the crude used to make them, rose to exceptional levels. The European indicator tracked by TotalEnergies rose from $13.5 to $33.2 per barrel, and Shell’s indicator from $24 to $42. Shell’s adjusted earnings increased by $983 million over Q2, including $978 million from its Chemicals and Products segment, which includes its refineries. Earnings from oil and gas production, however, fell 8.5%.
Cash went to debt first: All five companies reporting results reduced their net gearing ratio (Gearing), a measure of net debt relative to a financial base that varies by company definition, by between 2.1 and 6.6 percentage points in a single quarter. Three increased shareholder returns: Repsol raised its share buyback programme (Share Buyback), whereby a company buys its own shares in the market, from €500 million to €950 million, Shell from $4.2 billion to $5.0 billion, and Eni added special dividends of about €1.3 billion. Equinor kept its programme unchanged at $3 billion. Cash dividends for the quarter represented no more than 25.2% of operating cash flow, the cash actually generated by operations, at Shell, and about 29.8% at TotalEnergies.
Q4 starts from a higher base: According to EL7 data, Brent futures averaged $107.55 from the start of October through 28 October, 18.2% above the Q3 average. The US diesel margin remains 5.0% above its Q3 average, despite falling from September’s peak. Results from ExxonMobil, Chevron and BP on 30 October will answer the question: do US companies benefit from the same margin increase, or do they depend more on crude prices?
Shell
Where the jump came from Refineries: $978 million of a $983 million increase
Use of cash Raised buybacks to $5.0 billion and cut gearing to 16.6%
Increased distributions
TotalEnergies
Source of the jump Refining and liquefied natural gas (LNG), natural gas cooled into liquid: refining doubled to $3.6 billion
Use of cash Maintained planned buybacks of $2.5 billion, with a payout of 33% against a 40% target
Retained cash
Repsol
Source of the jump Refining: 85.3% of the quarterly increase
Use of cash Raised buybacks to €950 million and cut gearing to 6.2%
Increased distributions
Eni
Source of the jump Production: 1.83 million barrels of oil equivalent per day
Use of cash Special distributions of €1.3 billion and buybacks of €3.8 billion
Increased distributions
Equinor
Source of the jump Prices and production, and the Mongstad refinery
Use of cash Maintained buybacks at $3 billion and cut gearing to 3.8%
Retained cash
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