Key Takeaways
Austrian oil-and-gas firm OMV AG said first-quarter revenue fell 6 percent to 5.86 billion euros, as lower natural gas prices and a 7 percent drop in production due to the Middle East conflict weighed on results.
"The conflict in the Middle East disrupted supplies," the company said in a statement on Thursday, leading it to lower its full-year production outlook.
The Vienna-based company’s hydrocarbon output fell to 288,000 barrels of oil equivalent a day, down from a previous forecast of slightly below 300,000 barrels. Despite the top-line pressure, an adjusted operating profit of 1.03 billion euros ($1.19 billion) slightly beat analyst estimates of 1 billion euros, helped by stronger refining margins in its chemicals division.
The results highlight the direct impact of the Iran war on European energy firms, even those with limited regional production. While OMV expects Brent crude to average $85 to $95 a barrel for 2026, its lowered production guidance suggests a prolonged recovery, contrasting with US rivals like Chevron that are more insulated from the disruption.
The drop in OMV's output was predominantly due to a temporary shut-in of production facilities directly affected by the conflict that began February 28, according to a company report. The war's effective closure of the Strait of Hormuz, a chokepoint for 20 percent of the world's energy supply, has broadly disrupted production across the region.
As a result, OMV lowered its full-year production guidance to between 280,000 and 290,000 barrels of oil equivalent a day. This contrasts with more insulated American competitors like Chevron, which has only about 1 percent of its liquids production in the Middle East and anticipates a first-quarter increase in upstream earnings of $1.6 billion to $2.2 billion, according to company filings.
OMV's revenue was hit by lower natural gas prices in the first two months of the quarter, a performance drag also seen at rival Shell, which flagged weaker gas output. However, oil prices surged past $110 per barrel after the conflict began, creating a volatile pricing environment.
OMV said Thursday it expects the average Brent price to be between $85 and $95 a barrel in 2026, assuming the Strait of Hormuz reopens by the end of the first half of the year. The company's chemicals business provided a buffer, with higher refining margins partially offsetting the upstream losses.
This article is for informational purposes only and does not constitute investment advice.
