Shell raises dividend to shareholders as profit falls amid lower oil prices
Shell raises dividend to shareholders as profit falls amid lower oil prices
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Shell has hiked its dividend to shareholders despite profits falling last year, after the energy giant was hit by weaker oil prices and lower demand for the fossil fuel. The London-listed company raised its dividend by 4% while posting earnings of 23.7 billion dollars (£19.1 billion) for the calendar year, down from 28.3 billion dollars (£22.8 billion) in 2023.
Shell also said it had hit a cost-cutting target of 3 billion dollars (£2.4 billion) after setting the goal in 2022. Chief executive Wael Sawan said that despite the lower earnings, Shell’s cash flow remained “solid” at 40 billion dollars (£32 billion) across the year, while operating in “a lower price environment”.
“Our continued focus on simplification helped to deliver over 3 billion dollars in structural cost reductions since 2022, meeting our target ahead of schedule, whilst also making significant progress against all our other financial targets,” he said.
It comes after a year in which oil prices have steadied and demand has fallen, partly as a result of the growing popularity of electric vehicles. The oil supermajors, including US giants ExxonMobil and Chevron, have suffered falling margins in their refining businesses this year as a result.
The fossil fuel companies had made record profits in previous years after oil prices spiked during the global energy crisis. Shell wrote that the lower income reflected less money from its liquefied natural gas trading operation and lower oil refining margins, among other factors.
