|
Wholesale gas prices were volatile in April-June, driven by
maintenance in key supplier Norway, where Shell unexpectedly
extended an outage at its Nyhamna processing plant.
Shell cited "seasonality and fewer optimization opportunities"
as reasons for its lower gas trading result.
The company does not provide figures for its gas trading results
or say what proportion of its business it accounts for.
The benchmark front-month Dutch gas contract last traded at
32.90 euros per megawatt hour, down from above 100 euros last
year - including a spike to over 300 euros in August - and 70
euros at the start of this year.
Shell shares were up around 0.5% at 1234 GMT, lagging a European
index of oil and gas companies, which was up 0.7%.
"Shell's trading update included a number of operational
indicators which were broadly in line with our forecasts," said
RBC equity analyst Biraj Borkhataria in a note.
"Weaker trading across oil and gas which should be expected by
the market given lower gas prices and the seasonality of Shell's
LNG portfolio."
Shell’s trading typically generates smaller profits in the
second quarter due to lower seasonal demand.
The company added that trading performance in its chemicals and
products business was also expected be lower than in the first
quarter, with the indicative refining margin forecast to drop to
$9 a barrel from $15 a barrel.
U.S. rival Exxon also guided to lower refining margins this
week.
In an update ahead of second-quarter results on July 27, Shell
also flagged $3 billion in writedowns for the quarter, primarily
driven by a 1% increase in the discount rate used for impairment
testing.
This is an accounting move to reflect a higher-interest rate
environment, a spokesperson said.
(Reporting by Eva Mathews in Bengaluru and Shadia Nasralla in
London,Additional reporting by Nora BuliEditing by David Goodman
and Mark Potter)
[© 2023 Thomson Reuters. All rights
reserved.]
This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
