Shell profits more than double to record $40bn

Shell made a record annual profit for 2022 of almost $40bn, beating market expectations in the final three months of year on the back of a strong performance from its gas trading business.

Europe’s largest oil and gas company made adjusted earnings of $39.9bn for the year, more than double the $19.3bn it reported in 2021 and breaking the previous record of $31bn set in 2008.

The UK-based group posted adjusted earnings of $9.8bn in the final three months of the year, the second highest quarterly earnings in its history.

That far exceeded average analyst estimates of $7.97bn and was more than 50 per cent higher than the $6.4bn it reported in the same period last year.

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Almost two-third of Shell’s profits in the fourth quarter came from its gas business, which includes the world’s largest liquefied natural gas trading operations. That division, integrated gas, generated adjusted earnings of $6bn, Shell said.

Wael Sawan, Shell chief executive, said the record results demonstrated “the strength of Shell’s differentiated portfolio, as well as our capacity to deliver vital energy to our customers in a volatile world”.

The earnings continued a record-setting series of results of the world’s biggest energy companies, which have all benefited from high prices for hydrocarbons in the past 12 months due to the upheaval in energy markets caused by Russia’s invasion of Ukraine.

Exxon this week posted a $55.7bn profit for 2022, representing the highest annual earnings for a western oil company. Chevron made $36.5bn, while BP and France’s TotalEnergies are due to report next week and bring the total profits of the supermajors last year to almost $200bn.

The record profits generated by Shell and its rivals have led to widespread calls for higher taxation, and both the EU and the UK have introduced new levies in the past year. Shell said it expected to pay an additional $2.3bn in tax on its 2022 earnings due to the combined impact of the EU’s windfall tax and the UK’s energy profits levy. 

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