Big Oil earnings expected to edge up as analysts eye 2026 outlook

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By Sheila Dang, Shadia Nasralla and Stephanie Kelly

HOUSTON/LONDON (Reuters) -Big Oil may see marginally higher oil prices and stronger refining results boost third quarter results after declining earnings over the past year, but some analysts are more interested in how global oil majors set the stage for 2026 when they begin reporting results this week.

British oil major Shell and French major TotalEnergies will launch earnings season on Thursday and are expected to report 18% and 11% increases in adjusted net income, respectively, compared with the second quarter — though both figures are down from a year ago, according to analyst estimates compiled by LSEG.

Oil producers have faced a turbulent year marked by unpredictable trade tariffs and increasing oil output from OPEC+ countries, which have pushed prices down, leading to some of the lowest earnings since the pandemic. 

The supply gloom is expected to continue next year as the International Energy Agency forecasts a surplus of 4 million barrels per day with sluggish demand. Average Brent crude prices during the third quarter declined 13% from the same period last year and were up 2% from the second quarter. Average U.S. natural gas prices in the third quarter rose around 37% from last year.

European benchmark natural gas prices fell around 7% year-on-year in the July-September quarter.

“Greater focus will be placed on early 2026 outlook,” Barclays analyst Betty Jiang said in a research note, adding she is watching for commentary on cost impacts from tariffs and the gas outlook for next year as power demand from AI data centers continues to ramp up.

Higher production and soaring refining margins will help boost third quarter earnings, TotalEnergies said in a trading update this month. 

Analysts want to know how the company will address debt, which had soared 89% in the first half of 2025. Last month, TotalEnergies said it would cut buybacks, trim capital spending and sell more power and mature hydrocarbon assets, but the plans failed to ease investor concerns given lower commodity prices expected next year.

U.S. MAJORS FOCUS ON ONGOING INTEGRATION, REFINING MARGINS 

For U.S. oil majors Exxon Mobil and Chevron, which report results on Friday, analysts will be looking for early signs of any operational updates to come.

Chevron, which closed the $55 billion acquisition of Hess in July, is expected to report $3.4 billion in adjusted profit, or $1.71 per share. 

The results and subsequent call “will likely be used as an opportunity to tease out answers on key topics, as well as understand how well the Hess integration is going,” RBC Capital Markets analyst Biraj Borkhataria said in a research note.

Hess will contribute $50 million to $150 million in adjusted earnings excluding severance and other transaction costs, Chevron said in September. The company will provide further guidance in a widely anticipated investor day set for Nov. 12.

For Exxon, stronger refining results could lift earnings by up to $700 million compared with the second quarter. 

Analysts from TD Cowen said in a note that they expect Exxon to reduce annual capex spending on early-stage business opportunities, which is currently around $2.5 billion a year, though any such update could come during a corporate plan update scheduled for December. Exxon has been open about its hunt for acquisition opportunities and will likely field more questions about its search during the conference call.

BP releases third quarter results on Nov. 4, and net profit is expected to come down by around 10% from a year ago to just over $2 billion, according to LSEG data. Some of the downside impact should be buffered by higher refining margins in the customers and products division, where operating profits are seen to skyrocket over 300% on average, according to Reuters calculations based on estimates by three banks.

Analysts are also looking for updates on the company’s efforts to sell its Castrol lubricants business, a key step in the British oil major’s divestment strategy to boost its share price. 

(Reporting by Sheila Dang in Houston, Shadia Nasralla and Stephanie Kelly in London and America Hernandez in Paris; Editing by Nathan Crooks and Nick Zieminski)