Shell Shares Navigate Record Oil Prices and Tax Uncertainty

Shell shares near 52-week high as a historic crude surge boosts profits, but a potential 25%+ Australian LNG windfall tax poses a major regulatory threat.

Shares in energy giant Shell are trading near a 52-week high, buoyed by a historic surge in crude prices but simultaneously facing potential headwinds from new fiscal policies in key markets.

Unprecedented Oil Rally Fuels Earnings Outlook

Brent crude oil witnessed a staggering 60 percent surge in March 2026, marking the most significant monthly increase since records began. This dramatic price movement has significantly bolstered the financial position of major oil and gas companies. Barclays investment bank remains bullish, with analyst Lydia Rainforth reiterating a buy rating on Shell shares on March 31, accompanied by a price target of 4,500 pence. The bank's research suggests European energy firms could earn approximately 30 percent more in 2026 than current market valuations reflect. For the first quarter, Barclays forecasts Shell's profits will jump over 40 percent compared to the previous quarter, driven by stronger natural gas prices and improved refining margins.

Currently, Shell's stock price is trading nearly 25 percent above its 200-day moving average.

Australian Tax Proposal Casts a Shadow

Amidst this favorable commodity backdrop, political risks are emerging. The Australian government is considering implementing a windfall tax on liquefied natural gas (LNG) exports that could exceed 25 percent. Prime Minister Anthony Albanese has directed the treasury department to analyze reforms to the existing Petroleum Resource Rent Tax. Reports indicate such a measure could generate up to 17 billion Australian dollars in annual state revenue.

Cecile Wake, Shell's Australia chair, has cautioned against "short-term solutions," arguing that higher resource prices already contribute to public finances through existing corporate and resource taxes. The debate is critical for the region: Australia exported 65 billion Australian dollars worth of LNG last year, and spot prices in Asia have doubled to three-year highs due to tensions in the Middle East. A final decision from Canberra is expected in the coming weeks, with industry observers warning that enactment could dampen regional investment and potentially inspire similar moves by other LNG-exporting nations.

Share Buyback Program Proceeds

Concurrently, Shell continues to execute its ongoing share repurchase initiative. The program, announced on February 5, is scheduled for completion by May 1. On March 31 alone, the company repurchased just over 1.3 million shares for cancellation, paying average prices of £35.64 in London and around €40.97 in Amsterdam.

The interplay between record-breaking commodity markets and evolving fiscal landscapes presents a complex picture for Shell investors, balancing substantial near-term cash generation against longer-term regulatory uncertainties.