The global oil company Shell, on Thursday, announced profits of $9.1 billion for the first quarter of 2022, the biggest since 2008.
This development, according to the company’s Q1 2022 result report, is due to rising commodity prices, leading calls for oil and gas firms to pay a windfall tax to help British consumers with spiraling energy bills.
The corporation earned $9.1 billion in adjusted earnings for the three months ending March 31, according to the report. Revenues were $3.2 billion in the same quarter a year ago, and $6.4 billion in the fourth quarter of 2021.
According to Refinitiv, adjusted earnings for the first quarter will be $9.1 billion. In addition, the oil giant hiked its first-quarter dividend by nearly 4 percent to $0.25 per share.
Shell said it has completed $4 billion of its $8.5 billion share buyback program planned for the first half of the year.
The remaining $4.5 billion in share repurchases are expected to be completed before the second-quarter earnings report.On Thursday morning, the company’s stock gained 3 percent.
Read also: Oil majors’ first quarter profits boom on rising commodity prices
Shell’s profits mirror those seen across the oil and gas industry, despite the fact that many energy companies are taking large write-downs as a result of their pullout from Russia.
Recall that BP, a British rival, announced intentions to increase share buybacks on Tuesday after reporting its biggest first-quarter net profit in more than a decade. TotalEnergies of France, Equinor of Norway, and Chevron and Exxon Mobil of the United States all reported high first-quarter profits as commodity prices rose.
Shell revealed that its pullout from Russia resulted in $3.9 billion in post-tax charges in the first quarter. The corporation had previously warned that once it exited the nation, it would have to write off between $4 billion and $5 billion in asset value. These costs are not expected to have an impact on adjusted earnings, according to the company.
“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,” Ben van Beurden, Shell CEO, said in a statement.
“The impacts of this uncertainty and the higher cost that comes with it are being felt far and wide. We have been engaging with governments, our customers and suppliers to work through the challenging implications and provide support and solutions where we can.”
Shell reported a sharp upswing in full-year profit in 2021 on rebounding oil and gas prices.
Meanwhile, at a time when many customers are battling with rising energy costs, union groups and environmental protesters have branded record earnings for UK fossil fuel companies as “obscene.”
Opposition legislators have regularly urged Prime Minister Boris Johnson’s government to raise taxes on oil and gas corporations in order to assist low-income families.
If oil and gas corporations do not properly reinvest revenues, such a strategy, according to Rishi Sunak,Finance Minister, may be viable. Johnson, on the other hand, has rejected new calls for a windfall tax, claiming that it will deter investment and keep oil prices high in the long run.
In its newest round of economic measures, the European Union announced on Wednesday that it wants to restrict Russian oil imports within six months and refined products by the end of the year. The EU’s proposed sanctions reflect widespread dissatisfaction with Russian President Vladimir Putin’s aggressive attack on Ukraine.
On Thursday morning, oil prices continued to rise as a result of the news.
Brent oil futures were trading at $110.9 in London, up nearly 0.7 percent for the session, while West Texas Intermediate(WTI) futures were trading at $108.4, up 0.5 percent.
