Record profit: Shell takes advantage of high energy prices

Status: 05/05/2022 13:01

High oil and gas prices helped energy group Shell post a record profit at the start of the year. Shell plans to end all long-term purchases of Russian crude oil by the end of the year.

Shell posts record profit thanks to high energy prices. Adjusted profit climbed 43% to $9.13 billion, beating analysts’ estimates of $8.67 billion, the British oil company said. Shell joins the ranks of competitors such as BP, Exxon Mobil, Chevron and TotalEnergies, which have also seen strong growth thanks to higher energy prices and booming business operations.

End of Russian crude oil purchases

The war in Ukraine, which has been simmering since February, and EU-imposed or proposed import restrictions on fossil fuels from Russia have pushed up oil and gas prices. Shell has announced that it will end all long-term purchases of Russian crude oil by the end of this year, with the exception of two agreements with a “small independent Russian producer”. Shell did not name the company. Contracts to import refined petroleum products from Russia would also end. In the meantime, there are still long-term contracts for the purchase of Russian liquefied natural gas (LNG).

More LPG sold

Shell, the world’s largest LNG trader, said fuel sales rose 9% to 18.3 million tonnes in the quarter. LNG is seen as crucial to ending Europe’s dependence on Russian natural gas. The war in Ukraine “has caused significant disruption in global energy markets and has shown that secure, reliable and affordable energy simply cannot be taken for granted”, said Shell CEO Ben van Beurden. “The impact of this uncertainty and the higher costs associated with it are being felt everywhere.”

positive outlook

Nevertheless, the board sees Shell on the right track. The sales, which amounted to approximately 84 (previous year: 56) billion dollars, reduced the debt to 48.5 billion dollars against 52.6 billion previously. The $8.5 billion share buyback program is also progressing.

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