Royal Dutch Shell Plc will cut $15 billion
of investment over the next three years as the crash in oil
prices saw fourth-quarter profit miss forecasts.
Shell, the first of the world’s largest oil companies to
report earnings following the slump in crude to a five-year low,
will defer or cancel about 40 projects worldwide, Chief
Executive Officer Ben van Beurden said today. Exploration will
also be curtailed.
“We see pressure on our investment program,” van Beurden said on Bloomberg TV. “It’s a game of being prudent but at the same time not overreacting.”
Profit excluding one-time items and inventory changes was
$3.3 billion in the quarter, up from $2.9 billion a year
earlier, Shell said today. That missed the $4.1 billion average
of 13 analyst estimates compiled by Bloomberg.
Shell shares dropped as much as 5.2 percent in London and traded at 2,065.5 pence at 2:29 a.m.
The global industry is scurrying to respond as oil below $50 a barrel guts cash flows.
Occidental Petroleum Corp. and ConocoPhilips also announced lower spending today. BP Plc has frozen wages and Chevron Corp. delayed its 2015 drilling budget. By cutting investment, companies aim to protect returns to investors.
“We see pressure on our investment program,” van Beurden said on Bloomberg TV. “It’s a game of being prudent but at the same time not overreacting.”
Shell shares dropped as much as 5.2 percent in London and traded at 2,065.5 pence at 2:29 a.m.
The global industry is scurrying to respond as oil below $50 a barrel guts cash flows.
Occidental Petroleum Corp. and ConocoPhilips also announced lower spending today. BP Plc has frozen wages and Chevron Corp. delayed its 2015 drilling budget. By cutting investment, companies aim to protect returns to investors.
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