Austria's OMV raises energy price forecasts for 2026
OMV's Updated Energy Price Outlook and Market Impacts
By Tristan Veyet and Unknown e1ed8a8a-b9f1-446d-8173-f6c36f873e64
Revised Forecasts for Oil and Gas Prices
April 30 (Reuters) - Austria's OMV on Thursday lifted its forecasts for 2026 energy prices and said it expected higher prices to compensate for lower production caused by the Iran war and the closure of the Strait of Hormuz.
Brent Oil Price Projections
The oil and gas company raised its estimate for the average Brent price to between $85 and $95 a barrel in 2026, up from $65 a barrel, based on the assumption that the Strait of Hormuz will be reopened by the end of June.
Gas Price Expectations
It expects a realized gas price of 35 to 40 euros per megawatt hour (MWh) for the year, up from a February forecast of less than 30 euros per MWh.
Market Disruptions and Regulatory Responses
Impact of Geopolitical Events
The U.S.-Israeli war with Iran and subsequent closure of the Strait of Hormuz have caused oil prices to skyrocket past the $110 threshold as supply chains faced disruption.
Government Regulations and Company Compliance
"While refining margins remain at an elevated level, tighter regulations and government interventions – such as fuel price caps and changes in taxation in OMV’s operating countries – may negatively impact segment results," the company said.
Austria's New Fuel Tax Rule
OMV, in which the Austrian state holds a 31.5% stake, has brought itself into compliance with a new rule in Austria, which requires any rise in value-added tax revenue from higher fuel prices to be returned to consumers through lower fuel tax, capping retailers' margins.
Financial Performance and Operational Results
Quarterly Profit and Energy Division Performance
The Vienna-based company reported an operating profit of 1.03 billion euros ($1.19 billion) for the first quarter, just above analysts' expectations of 1 billion euros in a company-provided poll, benefitting from a stronger-than-expected performance in its energy division.
Exclusions and Special Items
The result is based on the current cost of supply and excludes one-off items and short-term gains and losses from energy inventory holdings.
Other Business Segments
OMV also reported a lower contribution from Borouge, which in March suffered from logistics disruptions and cost increases caused by the war.
Additional Information
($1 = 0.8578 euros)
(Reporting by Tristan Veyet and Danny Callaghan in Gdansk, editing by Milla Nissi-Prussak)
