Shell Oil reports record annual profit

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Shell Oil reports record annual profit

In 2022, Shell Oil said it had a record profit of nearly $40 billion, which is an eventful year for energy, which saw shareholders receive unprecedented returns due to Russia's invasion of Ukraine.

The previous record of $31 billion was exceeded by the annual profit of $39.9bn in 2008, which was more than doubled from the previous year, driven by higher oil and gas prices, robust refining margins and strong trading.

It is in line with the US rivals reports earlier this week, which will pressure governments to raise windfall taxes on the sector.

In a statement on the first set of earnings since he became the company's head on 1 January, Shell Chief Executive Wael Sawan said we intend to remain disciplined while delivering compelling shareholder returns. Shell posted a record fourth-quarter profit of $9.8 billion, higher than analyst estimates of $8 billion, despite a strong recovery in earnings from liquefied natural gas trading.

Earnings from its LNG division reached $6 billion, a record high, boosted by strong overall trading earnings due to gas price volatility.

Windfall taxes on the energy sector have been imposed by governments struggling with soaring energy bills. In 2022, Shell said it expects to pay accounting costs of $2.4 billion related to windfall taxes.

In the fourth quarter, Shell increased its dividend by 15 percent, the fifth increase since it cut dividends by more than 60 percent in 2020 during the COVID-19 epidemic.

After the Ukraine war, Shell and other Western energy companies mask some write-downs on Russian assets after they left the country.

Shell said this week it continued to export natural gas from Russia.

The aim of the company is to reduce greenhouse gas emissions in the next decade, as part of its ambition to build a large renewables and low-carbon energy business.