Shell posts $9.6 billion profit even as energy prices slide

Shell will reward shareholders by buying back an additional $4 billion in shares (Reuters file image)

Global energy giant Shell said Thursday that it earned nearly USD 10 billion in the first quarter, becoming the latest fossil fuel company to post strong financial results despite sliding oil and natural gas prices.

London-based Shell Plc reported adjusted earnings of USD 9.6 billion in the first three months of 2023, up 5.7 per cent from a year ago.

The company said it faced headwinds from higher taxes and lower prices for selling oil and natural gas, as energy prices have eased after spiking following Russia's invasion of Ukraine last year. Shell said those factors were offset by cutting operating expenses and better trading results.

In the first quarter, "Shell delivered strong results and robust operational performance, against a backdrop of ongoing volatility," CEO Wael Sawan said in a statement.

The company, whose annual profits doubled to a record high last year, also will reward shareholders by buying back an additional USD 4 billion in shares.

Shell is the second UK energy company this week to post stronger-than-expected earnings, with rival BP reporting that it earned USD 5 billion in the first quarter.

The financial earnings have become a political flashpoint in Britain, spurring calls from opposition politicians and campaign groups for oil and gas companies to do more to help consumers burdened by soaring energy bills that have contributed to decades-high inflation.

Critics have called for higher taxes on energy giants' windfall profits.

Oil and gas companies around the world have been reporting bumper earnings in the wake of Russia's invasion of Ukraine in February 2022, which sent energy prices soaring and curtailed some of Moscow's supplies to the world.

Last month, US company Exxon earned a record USD 11.4 billion in the first quarter, while Saudi Aramco reported that it earned USD 161 billion in 2022, the highest-ever recorded annual profit by a publicly listed company.