Oil giant, Shell has reported its highest quarterly profit since 2008 on soaring commodity prices, fueling calls for a one-off windfall tax on oil and gas companies to help U.K. households with spiraling energy bills.
Shell posted adjusted earnings of $9.1 billion for the three months through to the end of March, in line with expectations of analysts polled by Refinitiv. That compared with $3.2 billion over the same period a year earlier and $6.4 billion for the fourth quarter of 2021.
The company also announced plans to increase its dividend by around 4% to $0.25 per share for the first quarter.
Of the firm’s $8.5 billion share buyback program announced for the first half of the year, Shell said $4 billion had been completed to date. The remaining $4.5 billion share buybacks are scheduled to be completed before the announcement of second-quarter earnings.
Shares of the company rose 3% on Thursday morning.
Shell’s results echo bumper profits seen across the oil and gas industry, even as many energy majors incur costly write-downs from exiting Russia.
U.K. rival BP had on Tuesday announced plans to boost share buybacks after first-quarter net profit jumped to its highest level in more than a decade. France’s TotalEnergies, Norway’s Equinor and U.S. oil giants Chevron and Exxon Mobil also reported strong first-quarter profits on soaring commodity prices.
Shell confirmed it had taken $3.9 billion of post-tax charges in the first quarter as a result of its exit from Russia. The company had previously warned it could write off between $4 billion and $5 billion in the value of its assets after pulling out of the country. The firm said these charges were not expected to impact adjusted earnings.
“The war in Ukraine is first and foremost a human tragedy, but it has also caused significant disruption to global energy markets and has shown that secure, reliable and affordable energy simply cannot be taken for granted,” CEO Ben van Beurden said in a statement.
“The impacts of this uncertainty and the higher cost that comes with it are being felt far and wide. We have been engaging with governments, our customers and suppliers to work through the challenging implications and provide support and solutions where we can.”
Shell reported a sharp upswing in full-year profit in 2021 on rebounding oil and gas prices.
source@cnbc.com
