Shell profits tumble by 72% amid low oil and gas prices
Royal Dutch Shell has reported a 72% plunge in profits for the second quarter as the energy giant continues to be hit by low oil and gas prices.
The firm said adjusted earnings tumbled from 3.76 billion US dollars (£2.85 billion) to 1.05 billion US dollars (£800 million) as chief executive Ben van Beurden flagged the "significant challenge" lower energy costs are posing.
He said: "Downstream and integrated gas businesses contributed strongly to the results, alongside Shell's self-help programme. However, lower oil prices continue to be a significant challenge across the business, particularly in the upstream.
"We are managing the company through the down-cycle by reducing costs, by delivering on lower and more predictable investment levels, executing our asset sales plans and starting up profitable new projects."
Shell, which completed a 50 billion US dollars (£38 billion) acquisition of BG Group earlier this year, is embarking on an ambitious cost-cutting drive. The firm said in June that spending will be slashed by 35% to between 25 billion and 30 billion US dollars (£19 billion to £22.7 billion) over the next four years.
The firm also expects to make 4.5 billion US dollars (£3.4 billion) in efficiency savings from the merger with BG and Shell will also forge ahead with 30 billion US dollars (£22.7 billion) of asset sales over the next two years.