The Shell logo is displayed outside a petrol station in Radstock in Somerset, England, on Feb. 17, 2024.
Matt Cardy | Getty Images News | Getty Images
British oil giant Shell on Thursday posted a small year-on-year drop in third-quarter profit as a sharp decline in crude prices and lower refining margins were partially offset by higher gas sales.
The energy company reported adjusted earnings of $6 billion for the July-September period, beating analyst expectations of $5.3 billion, according to estimates compiled by LSEG.
Shell posted adjusted earnings of $6.3 billion in the second quarter and $6.2 billion in the third quarter of 2023.
Shell said it will buy back a further $3.5 billion of its shares over the next three months, while holding its dividend unchanged at 34 cents per share.
It marks the 12th consecutive quarter that Shell has announced at least $3 billion in buybacks, Sinead Gorman, chief financial officer at Shell, said in a video presentation.
“This quarter we have delivered another strong set of results despite a less favorable macro environment,” Gorman said.
“This was driven by solid operational performance across our portfolio, continuing the momentum we’ve built over recent quarters,” she added.
Net debt came in at $35.2 billion at the end of the third quarter, down from $40.5 billion when compared to the same period last year.
Shares of the London-listed firm rose 0.9% on Thursday morning.
‘A strong position’
Shell said third-quarter free cash flow rose to $10.83 billion, up from $7.5 billion in the same period a year earlier.
Cash capital expenditure, meanwhile, came in at $4.95 billion, down from $5.65 billion in the third quarter of 2023.
Maurizio Carulli, energy analyst at wealth manager Quilter Cheviot, said Shell’s third-quarter results were “much better than expectations at virtually every level” and show that the company “is continuing to deliver on its strategy of portfolio rationalisation, cost reductions and operational improvements.”
“Additionally, Shell is number one globally in liquified natural gas (LNG), a business it created from scratch since the seventies, with great foresight,” Carulli said, noting that LNG is the only segment of the oil and gas industry expected to grow substantially over the following decade.
“As such, the business has put itself in a strong position to weather any volatility in commodity prices and take advantage of competitor struggles,” he added.
Earlier this week, British rival BPposted its weakest quarterly earnings in nearly four years, weighed down by lower refining margins.
BP reported underlying replacement cost profit, used as a proxy for net profit, of $2.3 billion for the third quarter. That beat analyst expectations — but reflected a steep drop when compared to the same period a year earlier.
Oil prices tumbled over 17% in the third quarter amid concerns over the outlook for global oil demand.
Clean energy investments
Shell faced criticism on Thursday from activist shareholder group Follow This, which highlighted that the oil major’s third-quarter earnings show investments in the renewables and energy solutions division fell to 8% of the firm’s overall capital expenditure — down from 9% in the second quarter.
The decrease in clean energy investments comes after Shell weakened its 2030 carbon emissions reduction target in March.
Shell said in an energy transition strategy update at the time that it would water down its near-term carbon emissions cuts, while maintaining its pledge to become a net-zero company by the middle of the century.
“By continuing to bet on fossil fuel expansion, the board of Shell jeopardizes the future of the company,” Mark van Baal, founder of Follow This, said in a statement.
“Fossil fuel growth delays the transition and increases the risk of a carbon lock-in, which will make it harder to pivot to renewables each year,” he added.
Shell did not immediately respond to a request for comment.
A series of images of landscapes and wildlife from the Brigalow Belt region of Queensland near the town of St. George.
Colin Baker | Moment | Getty Images
Shares of Santos surged as much as 15.23% Monday, after it received a non-binding takeover offer of $18.72 billion by an Abu Dhabi’s National Oil Company-led group.
The move marks the biggest intraday jump in the Australian oil and gas producer’s shares since April 2020, LSEG data shows.
Prices of gold, the stalwart shelter in times of crises, rose. Investors flock to the precious metal amid uncertainty because it serves as a stable store of value that is mostly resistant against exogenous shocks, such as inflation or geopolitical conflicts.
And the dollar strengthened, as it is wont to do when the world looks ugly. Recall the dollar smile: The greenback will appreciate when things are really good because investors want in on U.S. risk assets, or when they are really bad because investors want in on the perceived safety of U.S. government bonds.
Stocks, the financial risk asset epitomized, fell across markets globally.
Despite the markets giving multiple indications we are entering a period of ugliness — or, at least, volatility — U.S. stocks still appear resilient, and the surge in oil prices only brings us back to where they were about three months ago as prices have been low since, CNBC’s Michael Santoli wrote.
The markets have, indeed, mostly shrugged off Russia’s invasion of Ukraine and the Israel-Hamas war, both of which are still brewing. But with the conflict between Israel and Iran still in its early days, it might pay to be extra cautious in the coming weeks.
Safe haven assets in demand Investors piled into safe-haven assets after Israel’s attack on Iran. After weeks of declining, the dollar index, a measurement of the strength of the U.S. dollar against other major currencies, rallied 0.3%on Friday and was up 0.1% as of7:30 a.m. Singapore time Monday. Spot gold rose 0.38% and gold futures for August delivery were up 0.41% Monday, adding to Friday’s gains of 1.4% and 1.5% respectively.
Prices of oil jump Oil prices surged as investors feared a disruption to oil supply from Iran, which produced 3.305 million barrels per day in April, according to OPEC’s Monthly Oil Market Report of May. As of Monday morning Singapore time, U.S. crude oil rose 2.22% to $74.62 a barrel, adding to its 7.26% jump on Friday. The global benchmark Brent climbed 2.22% to $75.88 a barrel, following Friday’s 7.02% surge.
[PRO]U.S. stocks still look resilient Even though stocks fell on the eruption of conflict between Israel and Iran, the market appeared resilient, wrote CNBC’s Michael Santoli. This week, while hostilities between the two Middle East countries will continue weighing on investors’ minds, they should not lose sight of the Federal Reserve’s rate-setting meeting, which concludes Wednesday.
And finally…
The Boeing 787-9 civil jet airplane of Vietnam Airlines performs its flight display at the 51st Paris International Airshow in Le Bourget near Paris, France. (Photo by: aviation-images.com/Universal Images Group via Getty Images)
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Fire and smoke rise into the sky after an Israeli attack on the Shahran oil depot on June 15, 2025 in Tehran, Iran.
Getty Images | Getty Images News | Getty Images
Crude oil futures jumped more than 3% Sunday after Israel struck two natural gas facilities in Iran, raising fears that the war will expand to energy infrastructure and disrupt supplies in the region.
U.S. crude oil rose $2.72, or 3.7%, to $75.67 per barrel. Global benchmark Brent was up $3.67, or 4.94%, at $77.90 per barrel.
Israeli unmanned aerial vehicles struck the South Pars gas field in southern Iran on Saturday, according to Iranian state media reports. The strikes hit two natural gas processing facilities, according to state media.
It is unclear how much damage was done to the facilities. South Pars is one of the largest natural gas fields in the world. Israel also hit a major oil depot near Tehran, sources told The Jerusalem Post.
Iranian missiles, meanwhile, damaged a major oil refinery in Haifa, according to The Times of Israel.
Oil prices closed more than 7% higher Friday, after Israel launched a wave of airstrikes against Iran’s nuclear and ballistic missile programs as well as its senior military leadership.
It was the biggest single-day move for the oil market since March 2022 after Russia launched its full-scale invasion of Ukraine. U.S. crude oil jumped 13% in total last week.
The war has entered its third day with little sign that Israel or Iran will back down, as they exchanged barrages of missile fire throughout the weekend.
Iran is considering shutting down the Strait of Hormuz, a senior commander said on Saturday. About one-fifth of the world’s oil is transported through the strait on its way to global markets, according to Goldman Sachs. A closure of the strait could push oil prices above $100 per barrel, according to Goldman.
However, some analysts are skeptical Iran has the capability to close the strait.
“I’ve heard assessments that it would be very difficult for the Iranians to close the Strait of Hormuz, given the presence of the U.S Fifth Fleet in Bahrain,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told CNBC’s “Squawk Box” on Friday.
“But they could target tankers there, they could mine the straits,” Croft said.
