Shell beat expectations with a profit of USD 9.6 billion in the first quarter

British oil giant Shell posted a stronger-than-expected first-quarter profit on Thursday, extending its record with good results after commodity prices rose in 2022 following Russia’s full-scale invasion of Ukraine.

Shell reported adjusted earnings of $9.6 billion for the first three months of the year, comfortably beating analysts’ expectations of $8.6 billion, according to Refinitiv.

The company had adjusted earnings of $9.1 billion in the same period last year and $9.8 billion for the final three months of 2022.

The oil major’s shares have changed little so far this year.

Flush with cash, Shell kept its share buyback rate steady at $4 billion over the next three months and kept its dividend unchanged at $0.2875 per share.

Shell said the quarterly results reflected improved operational performance and lower costs of running day-to-day operations. It added that robust results from fuel trading and optimization offset the impact of weaker oil and gas prices.

The company reported net debt in the first quarter of $44.2 billion, down from $48.5 billion compared to the same period a year earlier.

Reflecting on the first quarter results, CEO Wael Sawan said the company “delivered strong results and robust operational performance, against a backdrop of ongoing volatility, while continuing to provide vital supplies of secure energy.”

Shell’s results follow on the heels of British rival BP, which on Tuesday reported a drop in first-quarter profit but beat analysts’ expectations of robust oil and gas trading. Shares in BP fell on the news, but the London-listed company said it planned to scale back share buybacks.

Big Oil smashed previous annual profit records in 2022 during a period of volatile oil and gas prices in the wake of Russia’s full-scale invasion of Ukraine.

Shell, for its part, had adjusted earnings of $39.9 billion for the full year 2022. This surpassed the $28.4 billion in 2008 which Shell said was the company’s previous annual record and was more than double the company’s 2021 result of 19.29 billion dollars. .

Big Oil executives have typically tried to defend their huge profits amid a barrage of criticism, tending to emphasize the importance of energy security in the transition away from fossil fuels and suggesting that higher taxes could deter investment.

Combustion of fossil fuels such as coal, oil and gas is the main driver of the climate crisis.

Shell, which aims to become a net-zero emissions business by 2050, said first-quarter adjusted profit for its renewables and energy solutions unit came in at $389 million, up from $293 million for the last three months last year.