Shell to unveil profit boost from soaring crude prices

Rising prices have given the oil firms a lift out of the depression of recent years
Rising prices have given the oil firms a lift out of the depression of recent years
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Oil giant Royal Dutch Shell is expected to reveal that profits more than doubled last year as it benefited from the surging cost of crude.

Brent crude has hit $71 a barrel for the first time in more than three years, boosted by supply curbs from oil cartel Opec, a record run of declines in US crude inventories and a weaker US dollar.

This has helped oil majors such as Shell and BP emerge from an extended slump which saw Brent fall as low as 27.26 in January 2016.

Shell reported a 47% jump in adjusted earnings to $4.1 billion (£3.9bn) in the third quarter, thanks to the oil price rally.

And analysts are expecting more cheer as they predict Thursday’s annual results will show Shell’s adjusted earnings shooting up to $15.7bn (£11bn) from $7.2bn (£5bn) a year earlier.

Fund management experts at Hargreaves Lansdown recently praised Shell’s tactics since the oil price rout in 2014, including an aggressive cost-cutting drive and a $30bn (£21bn) divestment initiative.

They said: “This has left the group much more strongly cash-generative and reinforced Shell’s dividend-paying capabilities.