Sydney, March 31, 2026, 23:16 AEDT.
Shell Plc warned Australia on Tuesday that a proposed windfall tax on liquefied natural gas, or LNG, exporters would chill investment and weaken energy security, sharpening a clash with Canberra just as prices surge. Australia became the world’s second-largest LNG supplier after Iranian strikes forced Qatar to halt production, raising the stakes around any industry windfall. 1
The timing matters for Shell. LSEG data show analysts covering the company have raised first-quarter net profit estimates by an average of 15%, and Shell is due to publish a quarterly update note on April 8. That turns a political fight over gas taxes into an earnings issue. 2
Prime Minister Anthony Albanese has asked Treasury to model a tax on windfall gas profits and possible changes to the Petroleum Resources Rent Tax, or PRRT, a profits-based levy on oil and gas projects. His government on Monday also halved fuel excise for three months and rolled out a national fuel security plan as households absorb the shock from higher prices. 3
Cecile Wake, chair of Shell Australia, told the Australian Domestic Gas Outlook conference in Sydney that stable policy settings risked being pushed aside by “short-term measures or populist rhetoric.” Shell exports from Queensland Curtis LNG and operates the Prelude floating LNG facility off northern Australia, leaving it exposed to any shift in export rules or tax settings. 1
Chevron landed on much the same line. Danny Woodall, the U.S. major’s director of operations and maintenance in Australia, called a windfall levy “knee-jerk” and the “exact opposite” of what the country needed. Santos chief executive Kevin Gallagher said each LNG cargo leaving Gladstone delivered about A$4.5 million in royalties to Queensland. 1
The politics are getting harder because the money is getting bigger. Asia spot LNG prices have doubled to three-year highs since February, Brent crude has surged 59% in March, and Australia shipped A$65 billion of LNG last year. Around three-quarters of those exports are sold under long-term contracts tied to oil prices, so the earnings lift can take three to six months to show through. 3
Shell comes into that backdrop after a softer end to 2025. The company missed fourth-quarter profit expectations in February but kept a $3.5 billion quarterly buyback and lifted its dividend by 4%. Now the tone has shifted: Roth Capital Partners analyst Leo Mariani said the first quarter was likely to be “phenomenal” for the majors. 4
But Shell is not only a beneficiary of the crisis. Part of its Pearl gas-to-liquids plant in Qatar, which turns natural gas into transport fuels, was damaged in attacks this month, and management has warned the conflict could start squeezing European fuel supplies as soon as April. Higher prices help, but lost volumes, rerouted cargoes and repair bills can take some of that back. 2
Australia’s own supply picture is not moving in a single direction either. The Australian Energy Market Operator said last week that the risk of extreme peak-day shortfalls in southern states had slipped out by a year to 2030 as supply improved and demand eased. Even so, AEMO executive Nicola Falcon said the outlook had only “slightly improved” and new gas, storage and pipeline projects still need to land on time from 2030 onward. 5
That is why Australia matters so much to Shell. The company, the world’s biggest LNG trader, said this month that global LNG demand could rise 54% to 68% by 2040, with Asia accounting for most of the growth. Treasury is now working through the tax options, while Canberra is expected to detail a separate gas reservation policy later this year. 6
The dispute now moves from conference halls to Treasury spreadsheets. The next hard marker comes on April 8, when Shell is due to spell out the financial effects of the conflict in its quarterly update note. 2
