On April 29, 2026, employees of the Basra Oil Company work at the Nahal bin Umar oil and gas field on the outskirts of the southern Iraqi city of Basra.
Hussein Fareh | AFP | Getty Images
Oil and gas giants benefited greatly from their trading desks throughout the first quarter, highlighting commercially sensitive and often overlooked sectors that tend to outperform during periods of market volatility.
european oil supermajor total energy, shell and blood pressure All had strong trading results as they reported better-than-expected profits through the first three months of the year.
The results followed a period of extreme volatility in oil prices, particularly in March, as energy market participants closely monitored severe disruptions through the strategically important Strait of Hormuz amid the Iran war.
The Oil Trading Desk is a specialized division that buys, sells, and transports physical oil and gas while managing price risk. These units aim to generate revenue beyond upstream production, especially in times of market volatility. But oil majors typically do not disclose the profits of their trading divisions.
Trading can be a source of long-term profits, but it can also cause volatility and money management difficulties.
clark williams delhi
Energy Finance Analyst at IEEFA
Total Energy CEO Patrick Pouyanne said crude oil and petroleum products trading activity delivered a “very strong performance in March,” with quarterly net profit up 29% year-on-year to $5.4 billion.
Shell Chief Financial Officer Sinead Gorman said there was a “significant increase in trading and optimization contributions” throughout the first quarter, while BP highlighted the “exceptional” contribution of oil trading in its results.
Shell reported first-quarter adjusted profit of $6.92 billion, up from $5.58 billion a year earlier, while BP reported net profit of $3.2 billion, more than double the same period in 2025.
Maurizio Carulli, equity research analyst at Quilter Cheviot Investment Management, said Total Energy, Shell and BP stand out among integrated oil companies because they have been particularly successful in establishing large trading units in oil, gas and liquefied natural gas (LNG).
A customer refuels a vehicle at a BP Plc gas station on Monday, August 4, 2025 in London, England.
Bloomberg | Bloomberg | Getty Images
“It’s important to emphasize that the oil majors trade on the back of hydrocarbons that they produce or that are physically available to them. And these hydrocarbons can be physically moved around the world via owned or contracted ships and terminals,” Carulli told CNBC via email.
“In other words, this is an ‘appropriate and long-term activity’ and not financial speculation,” he added.
“U.S. oil companies may continue to seek to build large trading units, especially given the gradual shift of oil market influence from OPEC to the United States in recent years,” Carulli said.
Trading “succeeds in times of volatility”
The trading arms of Total Energy, Shell and BP are estimated to have made an extra $3.3 billion to $4.75 billion in profits in the first quarter compared with the final three months of 2025, the Financial Times reported on Monday, citing estimates from five analysts.
In addition to boosting first-quarter profits, the trading results highlighted a kind of transatlantic divide and revealed a rare competitive advantage for Europe’s top three oil majors, which have long struggled to close the valuation gap with their U.S. peers.
Brent Crude Oil Futures and US West Texas Intermediate Futures for the past three months.
Allen Good, director of equity research at Morningstar, said it was well understood that the presence of large trading organizations was driving the divergence of European integrated oil companies from their U.S. rivals. exxon mobil and chevron.
“During periods of high volatility, such as in 2022 when Russia invaded Ukraine or this year during the US-Iran war, European integrated oil companies benefit more than U.S. companies because they are able to take advantage of trading opportunities associated with higher commodity prices,” Good told CNBC via email.
He continued: “Given that trading thrives in periods of high volatility, its contribution is inconsistent and therefore not always fully appreciated by the market.” “However, most companies estimate that their return on capital increases by several hundred basis points over the course of the transaction cycle.”
BP is well known as one of the world’s most competitive trading businesses, with more than 2,000 employees serving 12,000 customers in more than 140 countries.
“Double-edged sword”
Dan Coatsworth, head of markets at AJ Bell, said Big Oil’s trading desks have been in the spotlight because of their significant contribution to quarterly profits.
“Big swings in prices increase the opportunity to make money. Since March, oil and gas prices have tended to move up and down frequently,” Coatsworth told CNBC in an email.
“If markets are calm, these companies can still make money from trading, but it may take a backseat to their core business revenues,” he added.
April 30, 2026 Gas prices over $6 per gallon are showing at Chevron and Shell stations in Monterey Park, California.
Frederick J. Brown | AFP | Getty Images
But while oil trading desks played an outsized role throughout the first quarter, some analysts cautioned that periods of such dramatic price movements do not necessarily represent a change in business models.
Alastair Syme, Citi’s head of global energy research, warned that it would be “somewhat unfair” to focus solely on oil price movements in March and conclude that the trend was representative of the company’s business.
“Ultimately, these companies exist to support that integrated business, right? So their priority is to supply their customers, and they need their refining and marketing operations to function in order to supply their customers,” Syme told CNBC on a video call.
“If they made a ton of money trading and there was a shortage at the pump, wouldn’t that be a big political issue? So I certainly feel like they’re going to struggle a little bit with margins as they look to meet customer demand in the second quarter,” he added.
Apart from the big oil companies’ rise, energy giants took on large amounts of short-term debt and drained cash reserves in the first quarter, said Clark Williams Derry, an analyst at energy think tank IEEFA.
This has caused operating cash flow at the five major oil companies to fall to their lowest levels since the coronavirus pandemic, Williams Derry said.
“All of this shows that trading and hedging are double-edged swords. Trading can be a source of long-term profits, but it can also cause volatility and money management difficulties,” Williams-Derry told CNBC via email.
“And as oil companies became more involved in transactions, so did their debt,” he added.
