Waiting game

30 April 2015 By Fiona Maharg-Bravo

Like BP and Total, profit from refining and marketing limited pain from low oil prices for the Anglo-Dutch major. Short term, it will struggle. But there is value to be had from the $70 billion tie-up with BG. The deal synergies could well be higher than advertised.

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Royal Dutch Shell on April 30 reported net profit of $3.2 billion in the first quarter of 2015, excluding inventory charges and one-offs, down 56 percent from the same quarter a year ago.

The sharp drop in oil prices sent upstream earnings down to $675 million in the quarter, from $5.7 billion a year earlier. This was partially offset by a 68 percent rise in profit from refining and trading to $2.65 billion.

Shell said cash from operations was $7.1 billion in the quarter, while capital investment totalled $6.8 billion and dividends paid cost $2.9 billion. Shell said it expects organic capital expenditure to be $33 billion or less in 2015, or $2 billion less than previous guidance. Shell has sold $2.2 billion in assets so far this year.

At 1050 GMT, Shell shares were up 1.3 percent to 2,095 pence.

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