Shell Slashes Oil Production Forecasts, Shares Fall Over 3%

Shell (SHEL) stock fell 3% as the company lowered oil production forecasts for Q2. It reduced the top end of its integrated gas division guidance to 900,000-940,000 barrels/day, and its LNG production outlook to 6.4-6.8 million metric tons. The company also expects upstream oil production to fall QoQ due to maintenance and the sale of the Shell Petroleum Development Company in Nigeria.

Shell (SHEL) stock fell by 3% on July 2, 2025, following the company's announcement of lower oil production forecasts for the second quarter. The integrated gas division's production guidance was reduced to 900,000 to 940,000 barrels per day (boed), down from the previous range of 890,000 to 950,000 boed [1]. Additionally, the company lowered its liquefied natural gas (LNG) production outlook to 6.4 million to 6.8 million metric tons, compared to the previous range of 6.3 million to 6.9 million tons [1].

Shell also expects upstream oil production to fall quarter-on-quarter in the second quarter due to scheduled maintenance and the completed sale of the Shell Petroleum Development Company (SPDC) in Nigeria. The company forecasted upstream production to be between 1.66 million to 1.76 million equivalent barrels a day, down from 1.855 million barrels in the first quarter [3].

The company's integrated gas division is expected to report significantly lower trading results than in the first quarter, driven by a volatile global market [2]. Despite these challenges, Shell remains committed to its long-term targets, aiming for a 4% to 5% annual increase in LNG sales over the next five years and a 1% annual production growth [1].

Shell is set to publish its full second-quarter results on July 31, 2025.

References:
[1] https://www.marketscreener.com/quote/stock/SHELL-PLC-130945922/news/Shell-trims-gas-LNG-output-outlook-flags-weaker-trading-50444074/
[2] https://www.standard.co.uk/business/business-news/shell-brent-middle-east-b1236703.html
[3] https://www.marketscreener.com/quote/stock/SHELL-PLC-130945922/news/Shell-Expects-Production-to-Fall-on-Scheduled-Maintenance-50444397/