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Brent crude oil prices in the first three months of this year
averaged around $67 a barrel, leaving last year's $54.5 behind
as a distant echo of the price crash of late 2014.
The world's top oil companies are expected to generate more cash
in 2018 than at any other time this decade after three years of
cuts, but boards remain cautious over near- and long-term price
uncertainty.
However, Shell shares slipped 2.7 percent by 1000 GMT as cash
flows fell short of investors' strong expectations. Total shares
gained 0.7 percent.
With Shell's output up 2 percent at 3.8 million barrels of oil
equivalent per day (boe/d) and Total's production rising 5
percent to 2.7 million boe/d in the quarter, both were well
positioned to capture the price upswing in benchmark oil prices.
The Organization of the Petroleum Exporting Countries, together
with other producers led by Russia, started in early 2017 to
throttle its output to revive prices and regain market share
from U.S. oil producers.
This month, Brent crude oil futures climbed above $74 a barrel,
reaching highs last seen in late 2014 -- a welcome development
for oil producers.
Shell reported a 42 percent rise in first-quarter profit, its
highest in over three years. Adjusted net income rose to $5.322
billion, topping a company-provided analysts' consensus of
$5.277 billion.
Total's net adjusted profit came in at $2.9 billion, beating
analysts' forecast of $2.77 billion in the quarter.
Armed with such results, Shell and Total are in payback mood to
investors, buying back shares after diluting stakes with scrip
dividends - consisting of shares rather than cash - introduced
after the price crash which sent oil prices as low as $28 a
barrel.
Shell plans to buy back $25 billion of shares by 2020 and Total
said it will raise first quarter interim dividend by 3.2
percent, while Scrip shares issued in January for the second
2017 interim dividend were bought back.
(Writing by Shadia Nasralla; Editing by Keith Weir)
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