Royal Dutch Shell Group .com Rotating Header Image

SHELL SURGES BUT BP FAILS TO CASH IN ON OIL PRICES

Sunday April 24,2011
By Tracey Boles

A DIP in production is expected to stop BP reaping the full benefit of the high oil price in its first-quarter results, out this week.

But arch-rival Royal Dutch Shell is forecast to enjoy a surge in first-quarter earnings on the back of the oil price which averaged $105 (£64) per barrel in the three-month period.

First-quarter profits at crisis-hit BP are expected to be broadly flat at $5.6 billion (£3.4 billion).

Analysts at Charles Stanley said: “Production volumes could be some 7 per cent lower and as a result, BP will have less leverage from higher oil prices which are some 32 per cent higher than a year ago.”

Shell’s earnings are expected to have risen about 20 per cent year-on-year to $5.9 billion (£3.6 billion). Charles Stanley’s analysts said: “Brent oil prices have averaged $105 per barrel compared with $76 per barrel a year ago, and this will have the largest impact on the bottom line.” They added: “After disappointing Q4 results, the 2011 first-quarter results will be quite an important staging post to see how Shell is performing financially against its growth plans.”

Within a year, Shell will produce more gas than oil according to the outgoing chairman of its UK operation, James Smith.

In the wake of the disastrous spill in the Gulf of Mexico a year ago, BP’s chief executive Bob Dudley is pursuing a strategy of forging alliances with national partners. BP is attempting a strategic alliance and share swap with Rosneft, the Russian state-owned oil giant.

But the transaction has been blocked by BP’s Russian partners in another venture in the country, TNK-BP, which claims the deal is in breach of its shareholders’ agreement.

A deadline for completing the share swap has been extended to May 16 in the hope that arbitration can resolve the issues.

SOURCE ARTICLE

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Comments are closed.