January 26, 2023

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Profits of billions in Shell despite the costs of withdrawing from Russia

Profits of billions in Shell despite the costs of withdrawing from Russia

Shell Energy benefited greatly from the rise in oil prices in the first three months of this year. The company made a profit of $7.1 billion, or 6.7 billion euros, despite the write-off of $3.9 billion (3.67 billion euros) Shell had to book its activities in Russia. Shell withdraws from that country because of the war.

“The war in Ukraine is first and foremost a human tragedy, but it has also shaken the global energy market and shown that reliable and affordable energy cannot be taken for granted,” said CEO Ben van Beurden.

Because of the war, Shell is closing hundreds of pumping stations in Russia and withdrawing from the huge Sakhalin 2 oil and gas project in the east of the country in northern Japan.

Departure price from Russia

High oil and gas prices boosted profits for all oil and gas companies. The average price of oil in the first quarter was 60 percent higher than the previous year. Oil and gas production has been solid and stable for most people.

Sanctions on Russia have cost four of the big five oil companies a lot of money, and only US company Chevron has escaped the billion-dollar dance because it is not active in Russia. ExxonMobil’s earnings doubled from the previous year. The American company lost $3.4 billion due to the discontinuation of its operations in Russia.

BP’s profit in the first quarter of 2021 was $4.9 billion, compared to this year’s scarlet loss of $20.4 billion, a direct result of writing off its $1 billion Russian operations, worth $25.5 billion. BP has called off its 19.75 percent stake in Russian oil giant Rosneft. France’s Total has written off $4.1 billion from Russia.

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Comparison of the Big Five Oil and Gas Companies: