EOG Resources raises Q3 tax guidance on Middle East oil prices

EOG Resources, Inc. revised its third quarter 2026 current tax expense guidance upward on October 8, 2026, citing higher crude oil prices realized during the period and anticipated for the full year due to the ongoing conflict in the Middle East. The Houston-based company now expects its third quarter current tax expense to fall between $835 million and $935 million, a significant increase from the $545 million to $645 million range originally provided with its second quarter results on August 4, 2026.

In its Form 8-K filing with the U.S. Securities and Exchange Commission, EOG stated that this update reflects market conditions that diverged from its expectations at the time of the initial guidance. The company clarified that it is not updating or confirming any other financial ranges for the third quarter or full year 2026 that were included in its August 4 guidance. The revision was signed by Ann D. Janssen, EOG's Executive Vice President and Chief Financial Officer.

For the quarter ended September 30, 2026, NYMEX West Texas Intermediate crude oil averaged $85.68 per barrel, while NYMEX natural gas at Henry Hub averaged $2.95 per million British thermal units. EOG noted that its actual realizations for crude oil and natural gas differ from these benchmark NYMEX prices due to delivery location basis, quality adjustments, and other revenue factors. Realizations for natural gas liquids are further influenced by the specific components extracted, such as ethane, propane, butane, and natural gasoline, along with their respective market pricing.

EOG disclosed that it received net cash of $40 million from settlements of Financial Commodity Derivative Contracts during the third quarter of 2026. The company enters into financial price swap, option, swaption, collar, and basis swap contracts to enhance the certainty of future revenues and cash flows. These contracts are accounted for using the mark-to-market accounting method. Additionally, EOG accounts for its 10-year natural gas sales agreement linked to Brent crude oil prices, known as the Brent Linked Gas Sales Contract, using the same mark-to-market method. No cash was received related to this Brent-linked contract during the quarter, as deliveries are expected to commence in January 2027.

The filing includes forward-looking statements regarding EOG's future financial position, operations, and performance. The company cautioned that these statements are subject to business, economic, and competitive uncertainties and contingencies, many of which are outside its control. Investors are directed to the risk factors in EOG's Annual Report on Form 10-K for the fiscal year ended December 31, 2025, for a detailed discussion of risks that may affect its business and performance.