Shell profits surge after oil price rises

Business & Economy 04 May 2017
Shell profits surge after oil price rises

Shell quarterly profits surge after oil price rises

The oil giant has been boosted by a recovery in the price of Brent crude after it slumped sharply in the last couple of years.

Image: Shell said it had enjoyed a strong quarter

By John-Paul Ford Rojas, Business Reporter

Shell saw profits quadruple to $3.4bn (£2.6bn) in the first quarter as it became the latest to benefit from the upturn in the oil price.

Shares rose 3% as the FTSE 100 giant posted better than expected results pointing to improved operational performance as well as "better market conditions".

It comes days after rival BP also revealed it had benefited from the recovery in the oil market as it swung back into profit for the first three months of the year.

Shell's quarterly profits were up 315% compared to the same period last year, when they came in at $814m (£631m).

The results were boosted by the rise in oil prices and deep cost cuts.

Ben van Beurden has run Shell since 2013
Video: North Sea 'wins' from Shell oil field sales

Oil companies have been under pressure after the price of Brent crude fell from more than $100 a barrel in 2014 to less than $30 at the start of last year.

They have since recovered to more than $50, partly thanks to an agreement by oil-producing countries to limit production in order to tackle the over-supply that was dragging on the price.

Chief executive Ben van Beurden said it was a "strong quarter for Shell".

He added that the group's takeover of smaller rival BG Group, which completed last year, was starting to pay off.

Shell has sold off around $20bn (£16 billion) of assets since its acquisition of BG, while earnings have also been boosted by hefty cost-cutting over the past three years.

It has been cutting thousands of jobs in response to the lower oil price and in February reported an 8% fall in annual profits.

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