Shell capped a record first quarter for the oil majors by announcing a doubling of earnings Friday as war in Iraq, turmoil in Nigeria and strikes in Venezuela provoked a surge in prices.
The three biggest oil groups -- ExxonMobil, Shell and BP -- earned almost US$16 billion in the first three months of this year when political unrest, military action and a cold winter in North America pushed prices to the ceiling.
Shell's net income was up 136% at US$5.3 billion, boosted by the US$1.3 billion sale of its stake in German gas company Ruhrgas, while its adjusted earnings -- its preferred measure -- rose 96% to US$3.9 billion.
Phil Watts, chairman, sounded a cautionary note by conceding that this happened in an "exceptional" quarter. He warned that the high margins were likely to be unsustainable in the months ahead.
Shell's record earnings came a day after Exxon, the world's largest oil group, reported the biggest quarterly corporate profits in history at US$7 billion and three days after BP announced its own record of US$3.7 billion.
Shell took some gloss from its figures by saying return on capital employed, the industry's benchmark, was 18.3%, against 20% at BP and 30% at Exxon.
The Anglo-Dutch group's earnings were propelled by a rise in profits at its exploration and production unit from US$1.45 billion a year ago to US$2.8 billion, on the back of higher prices.
Output of oil and gas rose to its highest levels in 10 years, up 6% to 4.2 million barrels a day, partly due to the contribution of Enterprise Oil, bought a year ago. Shell expects average output this year to be 4.1 million barrels a day.
The group said prices for the second quarter would depend on the level of OPEC oil available, the impact of the cartel's recent decision to cut output, lower seasonal demand and, not least, the return of Iraqi exports to the market.
OPEC is reducing production by 2 million barrels a day from June 1 and is holding out the prospect of further cuts to prevent over-supply and a collapse in prices.
Shell said oil refining margins were considerably higher than a year ago, with demand bolstered by the cold winter, high US natural gas prices and the extended shutdown of Japan's nuclear power plants.
"Margin outlook for the remainder of 2003 is uncertain and much will depend on the pace of global economic recovery and Opec output policy in response to the expected return of Iraqi crude exports to the market," it said.
Watts added: "In uncertain economic times, the diversity of our businesses and our geographic spread are strengths."
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
Netherlands-based semiconductor equipment supplier ASML Holding NV yesterday said that it is planning to hire an additional 1,000 people in Taiwan this year in response to growing demand from clients. ASML had previously planned to recruit 600 people this year, but that the plan has been adjusted upward, ASML vice president and ASML Taiwan general manager Grace Wang (汪佳慧) told reporters. ASML has a workforce of more than 4,500 in Taiwan, accounting for about 10 percent of its global total, Wang said. This year’s recruitment campaign would focus on adding people in the customer support, manufacturing and supply chain domains to assist ASML
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
Nvidia Corp yesterday announced that CEO Jensen Huang (黃仁勳) would attend an employee meeting in Taipei tomorrow to celebrate the launch of the company’s Taiwan headquarters project. Huang would attend a gathering at the site of Nvidia’s planned headquarters in Beitou Shilin Technology Park (北投士林科技園區), the company said in a statement. After arriving in Taiwan on Saturday last week, Huang told reporters that he plans to meet with Quanta Computer Inc (廣達) chairman Barry Lam (林百里) and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman C.C. Wei (魏哲家), and would attend the groundbreaking ceremony for Nvidia’s Taiwan headquarters tomorrow. Nvidia has not yet applied
RSS