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Could Shell cut its dividend for the first time since World War II?

Tom Howard: 15:15 10 Jul 2017

Shell to cut divi for first time since 1930s?

Oil giant Royal Dutch Shell PLC (LON:RDSB) was the first to grab my attention because of its famous divi.

It hasn’t cut its dividend since at least the 1930 but low oil prices, and possibly expectations of a dividend cut, have weighed on the share price in recent months, and it currently has a yield of 7%.

That’s enough to (just) bring it into the bottom of the screen, which would suggest that a cut could be on the cards.

It’s a suggestion that has been mooted by analysts at Citigroup, who recently said that the whole oil industry is “surely going to have to address the high cost of dividends”, with BP PLC (LON:BP.) and Shell having “the biggest questions (to) answer”.

Given that Shell’s divi has survived oil crises and wars, the world would likely turn on its head if a cut ever did materialise, but keep an eye out on this one nonetheless.

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