Genel Energy suffers first-half loss following Middle East conflict

Genel Energy PLC on Tuesday reported a loss in the first half of 2026, after production was disrupted by the conflict in the Middle East.

Meanwhile, the firm has described the planned acquisition of Egypt-focused Capricorn Energy PLC as a "key priority" to diversify the geography of its assets.

Shares in the exploration and oil production company with production assets in the Kurdistan Region of Iraq, and exploration assets in Oman and Somaliland, closed up 1.8% to 51.00 pence in London on Tuesday. Genel shares have fallen 16% over the past six months.

Genel's pretax loss widened to USD17.4 million during the first half of 2026, from USD3.5 million a year prior. The firm's revenue plunged 63% in the first-half of 2026 to USD13.4 million from USD35.8 million.

This was largely caused by the interruption of oil production following the start of the Middle East conflict at the end of February. Development operations resumed in April and production only restarted in June. As a result, gross average production in the first half fell to 26,400 barrels of oil per day fell from 78,400 a year prior.

Meanwhile, working interest average production fell to 6,600 barrels of oil per day from 19,600.

Average Brent oil price was USD91 a barrel during the half-year, up from USD72 year-on-year.

In July, Genel struck a deal to acquire Capricorn Energy PLC for USD360 million. A vote by Capricorn Energy's shareholders to approve the scheme is expected to take place on August 18. However, Capricorn received a rival takeover approach from Samos Energy later in July.

Genel Chief Executive Paul Weir said: "The proposed recommended all-cash offer for Capricorn Energy has been a key priority and represents a significant step in our long-standing strategy to diversify geographically, in this case Egypt, a jurisdiction that we have targeted for some time. The acquisition will substantially broaden and diversify our cash generation, while maintaining a very strong balance sheet, underpinned by significant cash resources and low leverage."

Weir said Genel continues to work closely with [distribution network operators] in Kurdistan to normalise production.

"We see much positive potential in the coming six to twelve months,” Weir said.

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