Following on from BP’s bumper profit announcement on Tuesday, Royal Dutch Shell declared a quarterly profits rise of nearly 50% today. In a corporate announcement, the oil giant said profits for the first quarter of the year came in at $4.9 billion; a 49% appreciation on profit noted over the corresponding quarter of 2009.A marked improvement in the price of crude, despite current wobbles, meant Q1 2010 profit was also well above the $1.2 billion profit figure noted over Q4 2009. In a statement, Shell chief executive Peter Voser said improved first quarter profits were "driven largely by our own actions," which included new explorations and organic production growth.
Looking ahead, Voser said, "So far in 2010, oil prices have remained firm, and demand for petrochemicals has increased, but refining margins, oil products demand and spot gas prices all remain under pressure. Although there are signs of an improving economic outlook, we are not relying on it."
It goes without saying that the average crude oil price of $75 per barrel seen this year has helped Shell as well as its peers, for it is a far cry from an average price of $41 per barrel seen in wake of the global financial crisis. Furthermore, Voser himself said last month that the era of cheap oil was over. Question is how expensive will it be in the short-term?
© Gaurav Sharma 2010. Photo Courtesy © Royal Dutch Shell
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