ENERGY giant Shell yesterday warned that its third-quarter profits would be dented as it weathered a sharp rise in refining costs and weaker earnings from natural gas trading.

The firm has been raking in record profits this year, which climbed to a whopping $11.5bn (£10.2bn) in the second quarter of this year - with Shell initiating a $6bn buyback for shareholders.

However, it now expects that profits will fall in the third quarter, as indicative refining margins dropped to $15 per barrel compared with $28 per barrel in the previous three months.

Shell's third quarter liquefied natural gas (LNG) and gas trading results are also expected to be "significantly lower", due to lower seasonal demand as well as "substantial differences between paper and physical realisation in a volatile and dislocated market".

This comes amid expectations of a global recession, driving down consumer interest in oil and gas amid reduced demand for air travel and reduced economic activity.

Chief exec Ben van Beurden set tongues wagging earlier this week, when he called for more taxes on companies to ease household energy bills. He believed market intervention was necessary to protect the poorest energy users as a "societal reality".

The energy boss is set to step down from his role by the end of the year.

(c) 2022 City A.M., source Newspaper