Anglo-Dutch oil giant Shell today issued a warning that its profits for the last three months of 2013 are as high as hoped.
Two weeks ahead of its official results announcement, the firm said the money it made at the end of 2013 is expected to be $2.9 billion (£1.8bn), “significantly lower than recent levels of profitability”.
That figure is around $1bn (£0.6bn) less than expected and nearly half the level it was in 2012. Shell blamed “weak” industry conditions in downstream oil products, higher costs of exploration and lower volumes of oil and gas upstream.
Ben van Beurden, who took over as Chief Executive from Peter Voser at the start of the year, said: “Our 2013 performance was not what I expect from Shell. Our focus will be on improving Shell’s financial results, achieving better capital efficiency and on continuing to strengthen our operational performance and project delivery.”
Other analysts noted the profit “shortfall” is split equally between upstream and downstream.
Neil Shah, analyst at Edison Investment Research said: “The weaker refining conditions Shell faces may just point to an economic recovery that is far more patchy than most expect. If Shell catches a cold the rest of the oil sector will always wonder if they will catch flu.”