Jul 30, 2020
Shell and Total escape underlying losses on strong oil trading
Royal Dutch Shell escaped a loss in the second quarter after stronger oil trading results helped to offset plunging energy demand triggered by the coronavirus pandemic that has battered the entire sector's finances. Despite an 82 per cent drop, during one of the industry's most brutal quarters, it beat the $674m loss that analysts had expected. Strong crude and oil products trading alongside lower operating expenses buffered Shell from the plunge in energy prices. Shell also announced a post tax impairment charge of $16.8bn, which the company had previously signalled, after it overhauled its price outlook and confronted the longer-term impact of coronavirus on its finances, demand for energy products and the global economy. The charge knocked Shell to a loss on a reported basis of $18.1bn. Reeling from the fallout of coronavirus, Shell cut its dividend for the first time since the second world war in April as the pandemic halved its earnings.
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