Shell warns of lower third-quarter profit as refining margins drop

Shell has warned that a drop in earnings from gas trading and lower refining margins will cut into its third-quarter profits. Europe's largest oil company on Thursday said its refining margins for the three months to the end of September were expected to be $15 a barrel, down from $28 a barrel in the previous quarter. The margin at the energy group's chemicals unit is expected to swing from $86 per tonne to minus $27 per tonne, quarter on quarter, after global demand for plastics contracted. In its gas business, Shell cautioned that trading would be "Significantly lower" compared with the second quarter "As a result of seasonality and substantial differences between paper and physical realisation in a volatile and dislocated market". The second quarter's record profit prompted Shell to launch a $6bn share buyback scheme.

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