LONDON/PARIS, Oct 27 (Reuters) – Europe’s two largest vitality corporations Shell (SHEL.L) and TotalEnergies (TTEF.PA) reported earnings of greater than $9 billion within the third quarter, although Shell’s liquefied pure gasoline (LNG) division struggled to seize the advantages of excessive gasoline costs.
The robust earnings have been prone to intensify calls in Britain and the European Union for additional windfall taxes on vitality corporations to assist households address gasoline and energy payments.
LNG costs have soared this yr as Moscow progressively reduce piped pure gasoline provides to Europe, which closely relied on Russian imports.
Western sanctions on Russia, which is among the many world’s main oil and gasoline producers, in response to its invasion of Ukraine in February, helped to drive European gasoline costs to an all-time excessive in August.
They’ve fallen closely in current weeks as Europe has stuffed gasoline storage and temperatures have been unusually gentle, however costs are nonetheless greater than a yr in the past.
The world’s largest LNG dealer Shell missed among the advantage of the value rise after a fall in manufacturing following strikes at Australia’s Prelude website. It additionally stated its buying and selling was hit by “substantial variations between paper and bodily realisations in a unstable and dislocated market”.
Its headline revenue in its built-in gasoline unit was down nearly 40% on the earlier quarter.
Total revenue of $9.5 billion was barely beneath final quarter’s file. Shell nonetheless determined to extend its dividend by 15% because it prepares for Wael Sawan to take the helm from Ben van Beurden subsequent yr.
TotalEnergies LNG, renewables and energy division reported a file earnings of $3.6 billion within the quarter, up $1.1 billion from the second quarter and greater than twice final yr’s, pushed by a 50% rise in LNG costs and a “robust” efficiency of its LNG buying and selling division.
This got here whilst its LNG gross sales volumes fell 10% on the quarter attributable to outages on the giant U.S. Freeport plant and elsewhere. Total, TotalEnergies made a file quarterly revenue of almost $10 billion.
TotalEnergies greater than halved its debt-to-capital, or gearing, ratio to 4%, underlining its comparatively robust steadiness sheet. Gearing at Shell, which is on observe for a file yr of earnings, elevated barely to twenty.3%.
Regardless of their hefty earnings, shares of Shell and its European friends TotalEnergies and BP (BP.L) have up to now this yr considerably under-performed their bigger U.S. rivals Exxon Mobil and Chevron whose enterprise fashions are weighted rather more in direction of fossil fuels than renewables.
Whereas Shell and BP’s shares have gained round 40%, Exxon is up 75% and Chevron over 50%.
Shares in Norway’s Equinor have additionally gained 54%, spurred by the gasoline worth surge.
Spain’s Repsol (REP.MC) on Thursday reported a doubling of its revenue to 1.48 billion euros ($1.49 billion).
($1 = 0.9938 euros)
Further reporting by Benjamin Mallet; modifying by Barbara Lewis
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