MENA Oil and Gas & Utilities: Navigating known unknowns: Top picks ADNOC L&S, Drilling and Luberef

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MENA Oil and Gas & Utilities: Navigating known unknowns: Top picks ADNOC L&S, Drilling and Luberef

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MENA Oil and Gas & Utilities

Navigating known unknowns: Top picks

ADNOC L&S, Drilling and Luberef

Price Objective Change

Prefer ADNOC L&S, Luberef and ADNOC Drilling 16 July 2026

Amid the ongoing regional uncertainty, our top picks heading into 2H26 are - 1) ADNOC Equity

L&S as elevated tanker rates are expected to remain supportive for 2H 2026; 2) Luberef MENA

as it benefits from a strong base oil crack margins leading to record earnings in 2026E; Oil and Gas & Utilities

and 3) ADNOC Drilling which stands out for its earnings resilience, and secured growth

Abhishek Kumar >>

from ADNOC’s production increase and unconventional expansion. We also maintain Buy Research Analyst

ratings on DEWA and Empower given their defensive business models and attractive Merrill Lynch (DIFC) +971 4 425 8227

dividend yields of c5%. We update our estimates and POs (see inside for details). abhishek.kumar29@bofa.com

Higher tanker rates create upside risk for ADNOC L&S SashankResearch AnalystLanka >>

Merrill Lynch (DIFC)

Our 2026E forecasts for ADNOC L&S remain ahead of guidance driven by supportive +971 4 425 8231

tanker rates, with 35% EBITDA and 79% net income growth (vs management guidance sashank.lanka@bofa.com

of high 20% EBITDA growth and high 60% net income growth). We are also 23%/40%

above consensus, respectively. Beyond spot, ADNOC L&S is also a medium-term

beneficiary of ADNOC’s increased activity. It is adding 4 LNG vessels for delivery in Exhibit 1: Coverage stocks

2029, and we expect more growth in shipping/ logistics linked to ADNOC’s plans. Changes to our POs

Company Rating New PO Old PO