British energy giant Shell PLC yesterday said its net profit soared 26 percent in the first quarter of the year as soaring oil prices offset a sizeable charge linked to its Russia exit.
Profit after tax leapt to US$7.1 billion compared with a year earlier, Shell said in a statement.
While the group took a US$3.9 billion charge on its exit from Russia after Moscow invaded Ukraine, it saw lower costs elsewhere.
Photo: AFP
Underlying earnings spiked almost threefold to a quarterly record of US$9.1 billion, sparking fresh calls in the UK for a windfall tax on energy majors.
British consumers are enduring a cost-of-living crisis caused by the highest rate of inflation in decades, also as economies reopen from COVID-19 pandemic lockdowns.
British Prime Minister Boris Johnson, who was yesterday facing a key midterm test in local elections, has dismissed calls for a windfall levy on oil giants, arguing it would slow their efforts to invest in cleaner energy.
Shell added that its revenue rallied 51 percent to US$84.2 billion in the first three months of the year.
Oil prices have surged in the past few months on concerns over tight supplies following the invasion of Ukraine by major oil and gas producer Russia.
“The war in Ukraine is first and foremost a human tragedy, but it has also caused significant disruption to global energy markets and has shown that secure, reliable and affordable energy simply cannot be taken for granted,” Shell chief executive Ben van Beurden said.
“The impacts of this uncertainty and the higher cost that comes with it are being felt far and wide,” he added.
The London-listed group last month flagged that it would take a hit of between US$4 billion and US$5 billion in the first quarter as a result of impairment from assets and additional charges relating to its Russian activities.
Shell announced in late February that it would sell its stakes in all joint ventures with Russian state energy giant Gazprom after the Kremlin launched its assault on Ukraine.
The company then decided in March to withdraw from Russian gas and oil in line with UK government policy.
Shell’s British rival BP PLC on Tuesday booked its biggest-ever quarterly loss, at US$20.4 billion.
This after BP booked a US$25.5 billion charge on its Russian withdrawal.
Shell added yesterday that it has begun the second tranche of its US$8.5 billion share buyback program that was unveiled in February.
The group’s share price rallied 3.1 percent to ￡2.95 in yesterday morning deals on London’s rising stock market.
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