TotalEnergies - growth of accretive barrels expected to come overwhelmingly from outside the Middle East in 2026, higher oil price more than offsets loss of Middle East production

TotalEnergies has outlined its strategic outlook for 2026, emphasizing that growth in accretive barrels will predominantly originate outside the Middle East amid production reductions in the region. Production has been shut down or is in the process of shutting down in Qatar, Iraq, and UAE offshore, representing approximately 15% of the company's total output. These operations contribute ~10% of TotalEnergies' Upstream cash flow, though Middle East barrels generate lower cash flow from operations (CFFO) due to higher taxation. The company noted that a $8/b increase in Brent prices would offset the expected 2026 CFFO loss from these assets at a Brent price of $60/b.

Despite the production drawdown, TotalEnergies anticipates maintaining growth through accretive projects outside the Middle East. Onshore UAE production (~210 kbpd of TotalEnergies' share) remains unaffected, as it is exported via the Fujairah terminal. Operations at the Satorp refinery continue normally, supporting Saudi domestic demand. The impact of LNG production shutdowns in Qatar on trading activities is limited to ~2 Mt annually, as most Qatari LNG is marketed by QatarEnergy.

The company's guidance aligns with its focus on diversifying production sources to mitigate regional risks. TotalEnergies remains committed to updating stakeholders on material developments, with the Investor Relations team available for further clarification. This strategy underscores resilience amid geopolitical uncertainties, leveraging higher oil prices to offset Middle East production declines.

TotalEnergies, Investors – Current status of exposure in the Middle East: TotalEnergies, Investors – Current status of exposure in the Middle East.