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shell The company’s annual profit was expected to fall by more than a fifth last year as oil prices suffered their biggest drop since 2020 at the height of the coronavirus pandemic.
Annual results for the FTSE 100 oil majors due on Thursday will reveal the impact of a sharp fall in crude oil costs, which fell for a record-breaking 19% for a third consecutive year as the world economy’s supply outstrips demand.
The drop in oil prices comes in a year marked by conflict, rising tariffs and increased supplies from oil producers. Brent Last month, crude oil prices fell below $60 a barrel for the first time in nearly five years.
Most analysts forecast Shell’s full-year underlying earnings will fall 21% to $18.79bn (£13.66bn), down from $23.72bn (£17.22bn) in 2024.
Annual revenue is expected to fall 14% to $56.71bn (£41.22bn) on its preferred current costs of supplies (CCS) basis.
Fourth quarter underlying earnings CCS The basis will fall to $12.88 billion (£9.36 billion) from $14.28 billion (£10.38 billion) a year earlier.
Shell’s latest report showed weakness in its trading business in the latest quarter as crude prices fell and hinted at losses at its troubled chemicals and products unit.
Despite this and broader market and geopolitical pressures, Shell’s share price has remained largely resilient, with a recent rise in Brent crude prices above $70 a barrel helping to support the stock.
AJ Bell experts said: “This may be partly down to boss Wael Sawan’s continued focus on reducing costs, capital expenditure and debt, as well as his focus on maximizing the value of Shell’s hydrocarbon assets and balancing this with investment in future growth in renewable energy.”
They added: “Shell’s January results were mixed, thanks to a weak performance in oil and gas trading and a tough period in the chemicals business, although lower oil and gas prices brought some relief to the refining business’s cost base.
“China has a huge cost advantage in energy and overcapacity remains a major problem for the global chemicals and petrochemical industry.”
Analysts at AJ Bell said: “Shareholders will be closely watching capital expenditure in 2025 and 2026, compared with $19.6bn (£14.25bn) in 2024.”
Shell’s bosses may also face: Venezuela as president of the united states Donald Trump Major players in the industry are under pressure to return to the country after the United States captured leader Nicolás Maduro.
They are also likely to be grilled again over potential plans to shift listings from London to New York.
Michael Hewson of MCH Market Insights said: “While there are no live discussions yet, there are still concerns that moving the main listing to New York is still under consideration due to the ongoing valuation gap between it and its US peers Exxon Mobil and Chevron.”