Oil and gas giant Shell has reported record annual profits after energy prices surged last year following Russia’s invasion of Ukraine.
Profits hit $39.9 billion in 2022, double the previous year’s total and the highest in its 115-year history.
Energy firms have seen record earnings since oil and gas prices jumped following the invasion of Ukraine. Energy prices had begun to climb after the end of Covid lockdowns but rose sharply in March last year after the events in Ukraine led to worries over supplies. The price of Brent crude oil reached nearly $128 a barrel following the invasion, but has since fallen back to about $83 a barrel. Gas prices also spiked but have come down from their highs.
Shell announced a $4 billion share buyback program, which is expected to be completed by its first-quarter 2023 results — due out by early May — and a 15% dividend per share increase for the fourth quarter.
“It is a huge year for Shell and a huge year to look back on as well,” Shell CEO Wael Sawan told CNBC’s Steve Sedgwick in his first earnings interview since taking on the role on the 1st of January.
“I feel privileged to be stepping into this role at such a great point in the company’s history. As we look ahead, I think we have a unique opportunity to be able to succeed as the winner in the energy transition. We have a portfolio that I think is second to none,” Sawan said.
“My focus will be very much around performance and capital discipline,” he added.
The results follow in the footsteps of historic annual earnings for U.S. oil majors Exxon Mobil and Chevron, with the West’s largest oil and gas companies expected to rake in combined profits of nearly $200 billion for the year, according to Refinitiv data.
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