HSBC lifts oil price assumptions, upgrades Shell and Repsol to 'buy'
18/05/2026 09:32
** HSBC updates its view on global integrated oil stocks to reflect a "higher-for-longer" commodity backdrop, with the duration of Middle East disruption now the key variable rather than the initial price shock ** It lifts Brent assumptions to $95 a barrel for 2026 and $75 for 2027, underpinning average EPS upgrades of 13% and 11%, respectively, with the largest uplifts skewed to higher oil exposure and lower tax rates (Chevron and Exxon) ** HSBC assumes Hormuz traffic will gradually restart from mid-June, with flows returning to near-normal by end-Q3 ** The broker expects incremental cash flows to be primarily allocated to balance sheets, though it sees buyback upside at TotalEnergies, Eni, Equinor and Repsol in 2026 and Shell in 2027 ** Trading emerges as a key differentiator for European majors with an estimated post-tax uplift of over $4 billion across Shell, BP, Total and Equinor, largely from liquids trading ** Mark-to-market "timing effects" have distorted reported results for Exxon and Chevron and should unwind over time ** HSBC upgrades Shell and Repsol to "buy" from "hold"
| COMPANY | RATING | OLD RATING | PT | OLD PT |
|---|---|---|---|---|
| BP BP.L | Hold | GBp 605.00 | GBp 620.00 | |
| Chevron CVX.N | Buy | USD 221.00 | USD 217.00 | |
| Exxon Mobil XOM.N | Hold | USD 168.00 | USD 158.00 | |
| Shell SHEL.L | Buy | Hold | GBp 3,700.00 | GBp 3,350.00 |
| TotalEnergies TTEF.PA | Hold | EUR 81.00 | EUR 81.00 | |
| Eni ENI.MI | Hold | EUR 23.50 | EUR 22.00 | |
| Repsol REP.MC | Buy | Hold | EUR 25.50 | EUR 22.00 |
| Equinor EQNR.OL | Hold | NOK 335.00 | NOK 355.00 | |
| Galp GALP.LS | Hold | EUR 20.00 | EUR 20.00 | |
| OMV OMVV.VI | Reduce | EUR 51.00 | EUR 50.00 |
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