Woodside Energy Shares Close Week Red, With Oil Back At $100

Woodside Energy shares (ASX: WDS) closed Friday’s session down 1.7% at A$32.42, as crude oil pulled back from midweek highs. Reports of a potential near-term restart of Saudi Arabia’s East-West pipeline contributed to easing supply fears, taking some heat out of the geopolitical premium that had been priced into crude through much of the week.

The week’s price action told a story of two halves, with the Woodside share price up alongside crude oil by midweek as WTI touched US$106 per barrel, before retreating in lockstep as oil gave back ground to close the week just over US$100. The stock finished Friday down 1.7%, with a weekly pullback of 1.34% leaving the stock just below the 30 day SMA, but perhaps crucially, above the 50 day SMA of A$32.25 heading into the new week.

Despite the pullback, Woodside holders are sitting on impressive gains of 37% since the start of 2026, a performance that has comfortably outpaced the broader ASX 200 energy index.

Recent Fundamentals Support Outperformance

Woodside’s fundamental picture remains materially stronger than it was twelve months ago. The company’s most recent half-year result showed operating revenue climbing 13% year-on-year to US$7.45 billion, while net profit after tax rose 27% to US$1.67 billion. Free cash flow expanded to US$352 million over the period, underpinned by higher realized commodity prices that more than offset a 13% decline in production volumes to 86.5 million barrels of oil equivalent.

That production dip was largely attributable to the scheduled Pluto LNG turnaround, cyclone-related disruptions, and the impact of asset sales, characterised as temporary rather than structural. Unit production costs rose to US$8.80 per barrel of oil equivalent during the period, though this remains well below current realized prices, which averaged US$74.0 per barrel of oil equivalent in H1 2026. At current WTI levels near US$100, the margin expansion story for the second half of the year is compelling.

The flagship Scarborough Energy Project in Western Australia is now 98% complete and remains on track to deliver its first LNG cargo in the fourth quarter of 2026. The milestone is significant: Scarborough’s transition from capital-intensive construction to active revenue generation is expected to be the single most important catalyst for Woodside’s free cash flow profile heading into 2027. The company also reported a plant reliability rate of 98.7% across its existing LNG operations, underscoring its operational execution credentials.

On the income side, Woodside declared an interim dividend of US$0.57 per share, translating to an annualised yield in the vicinity of 5.9% to 6.0% on a fully franked basis, providing a meaningful income floor for long-term holders.

What Lay Ahead For WDS?

The debate now has shifted to valuation, with undoubtedly a strong fundamental story set against a stock price that has already priced in plenty of the bull case.

Trailing P/E has expanded to 14.3 times, above the stock’s five-year historical median of around 11 times, yet the forward earnings projections is where things get interesting. If Scarborough delivers on schedule and oil prices hold above US$90 per barrel, consensus EPS estimates suggest earnings could rise more than 20% into fiscal 2027, compressing the forward multiple back toward a more modest 12 times.

After a strong 37% rally through the first three quarters of 2026, Woodside shares have entered a consolidation range between $31-$33, with last week’s candle a red one. Markets will be watching oil prices for clues, until the next corporate update.