Shell will buy back $4 trillion in shares and increase its dividend by 15% after posting another huge quarterly profit, boosted by strong oil and gas prices.
The UK-based company posted a profit of $9.45 billion in the third quarter, more than double the $4.1 billion it recorded a year ago. The result was driven by strong performance in its oil exploration and production business, Shell said.
The company’s shares rose more than 4% at one point in London on Thursday as investors cheered the news. The additional purchases will bring total stock repurchases for the year to $18.5 billion, about 10% of the company’s share capital.
The third-quarter performance means Shell has reported profits of more than $30 trillion in the first nine months of the year – 58% more than it recorded in all of 2021. It earned a record $11.5 billion in the second quarter. oil prices were more than 100 dollars a barrel.
“We are delivering strong results at a time of continued volatility in global energy markets,” Shell CEO Ben van Beurden said in a statement.
Energy companies have enjoyed huge profits this year due to rising oil and gas prices, leading European governments to introduce promising taxes to help households facing rising energy bills. The UK government is considering similar measures and Shell’s earnings announcement on Thursday will give supporters further impetus.
Ed Miliband, climate change and zero leader of the opposition Labor Party, said Twitter that the gains were “further proof that we need an adequate tax to make energy companies pay their fair share.”
In a call with reporters Thursday, Van Beurden, who will step down at the end of this year, said the industry should talk to officials to make sure those taxes are well-designed.
“We should prepare and accept that our industry will be scrutinized to raise taxes to fund transfers to those who need it most in these difficult times,” he said.
Van Beurden added that he was proud that Shell’s emissions had dropped by a third since he became CEO nine years ago, but he regretted not stopping oil drilling in the Alaskan Arctic “sooner and faster.” Shell ended drilling offshore Alaska in 2015 after nearly a decade of exploration that cost the company billions of dollars.