Higher prices amid global energy crisis offset wild weather impacts for Woodside Energy in first quarter

War in the Middle East has boosted revenue for Woodside Energy amid a global energy crisis — with further upside set to supercharge earnings in coming quarters — despite wild weather in WA’s North West crimping production. Australia’s biggest energy producer delivered 45.2 million barrels of oil equivalent in the first three months of 2026, down 8 per cent on the final quarter of the previous year. Woodside’s giant Karratha gas export plant was forced offline after a major outage caused by severe tropical cyclone Narelle in March, while Mitchell also affected onshore and offshore operations in February. But prices driven higher by the closure of the Strait of Hormuz in the Middle East — which transits about 20 per cent of global oil and LNG supply — after the US and Israel launched attacks on Iran in late February more than offset the financial blow from the fall. Average realised prices in the first quarter jumped 11 per cent from the previous three-month period to $US63/boe as international oil benchmark Brent and European gas jumped more than 70 per cent in the period. Operating revenue leapt 7 per cent to $US3.26 billion ($4.54b). Analysts at Ord Minnett said the result beat consensus by 8 per cent, driven by stronger-than-expected volumes largely from inventory drawdowns and higher third‑party sales, albeit at lower margins. “We have seen modest increases to our portfolio average realised pricing in the quarter, driven by elevated spot prices,” said newly appointed chief executive Liz Westcott. “Further benefits of currently higher spot prices will be realised in subsequent quarters for LNG due to lagged contract pricing.” Most LNG is sold under long-term contracts, often linked to the price of oil with a three to six-month delay. That has intensified competition among buyers that are rebuilding inventories after the peak northern hemisphere winter season for limited spare cargoes from exporters such as Woodside and rival Santos. The market tightness has lifted stocks in Australia’s LNG-heavy energy export sector, which posted a record first quarter. Woodside also benefited from plant efficiencies, with its Sangomar, Shenzi, North West Shelf Project and Pluto LNG operations all delivered reliability at or above 99 per cent during the period. Woodside maintained full-year guidance of between 172 and 186mmboe. The company said there had been no disruptions to its trading activities as a result of the conflict in the Middle East, with shipping operations continuing as planned. It added it did not currently have any controlled shipping that traverses Iranian waters or the Straits of Hormuz and its trade routes were not subject to increased security risk. As Woodside closes in on completion of its $US12.5b Scarborough project and first production later this year, Ms Westcott said the company would prioritise organisation efficiency and improve capital management as the business looks to balance growth spending with shareholders returns. “Cost discipline is essential to sustained shareholder value creation and we are commencing a structured review of our business to streamline decision making, reduce complexity and improve accountability,” she said.