Oil market turmoil pumps up revenue for Woodside Energy

The Middle East war has swelled Woodside Energy’s revenue but forced the group’s Louisiana LNG project to source alternative steel supplies because of the threat to shipping in the Strait of Hormuz.

The spike in prices triggered by the conflict sent Woodside’s second-quarter turnover hurtling 28 per cent higher to $US4.12 billion ($5.9b) as its averaged realised price leapt 35 per cent to $US85 a barrel of oil equivalent.

That was despite production from the group’s global portfolio sliding 9 per cent to 41.3 million barrels, mainly because of a planned shutdown of one of the two processing trains at its Pluto LNG project in the Pilbara.

That meant that at a time of heightened demand for the fuel, Woodside had less than the targeted 25 per cent of LNG production it reserves to benefit from the higher-priced spot market.

Still, revenue for the first half of 2026 was 13 per cent higher at $US7.4b.

Chief executive Liz Westcott said the stronger prices for the quarter “reflects the volatility we are seeing in markets in general on the back of the Middle East”, noting that because of a price lag on its sale contacts the company could be expected to reap strong prices for a couple of more months yet.

“Both European and Asian customers are interested in additional LNG,” Mr Westcott said.

Woodside’s Louisiana LNG plant is 28 per cent complete, but Woodside said Iran’s attacks on shipping in the Strait of Hormuz “continue to challenge” steel deliveries from construction contractor Bechtel’s steel plant in the United Arab Emirates.

“Mitigation measures are being implemented, including alternative logistics routes and fabrication sources, to support continuity of steel supply and maintain planned construction schedules beyond 2026,” it said.

The US development is being built as Woodside’s $16b Scarborough gas project off north-west WA closes in on first production. Scarborough is 98 per cent complete and on track to export its first gas in the final quarter of 2026.

Woodside also said its board had formally kicked off the search for a new chair to succeed Richard Goyder, with the process to be led by independent non-executive director Swee Chen Goh.

This succession has attracted more interest this time around given concern in some quarters about the declining numbers of Australian directors on the Perth-based company’s board.

It has also been muddied by the sudden resignation three weeks ago of Woodside director Tony O’Neill amid investor concerns about his private business links to a fellow board member Mark Cutifani, who is considered the leading internal candidate to replace Mr Goyder.

The former Wesfarmers boss has signalled he will step down on or before next year’s annual meeting in April.

Woodside said on Wednesday the board would “consider a range of factors in identifying and selecting the next chair, including leadership capability and experience, governance expertise, strategic insight, stakeholder engagement expertise and the capacity to oversee the creation and maintenance of shareholder value by a global company”.

Woodside used the quarterly to disclose it has narrowed its production guidance for the full year to between 174mmboe and 185mmboe.