Shell expects hard blow due to coronavirus, collapsing oil prices
- Date: 01-Jul-2020
- Source: Jordan Times
- Sector:Oil & Gas
- Country:Saudi Arabia
Shell expects hard blow due to coronavirus, collapsing oil prices
LONDON “” Energy giant Royal Dutch Shell will take a vast charge of up to $22 billion (19.6 billion euros) due to chronic fallout from coronavirus and collapsing oil prices, it announced on Tuesday.
The Anglo-Dutch company said in a statement that it will face a charge of between $15 billion and $22 billion in the second quarter, after crude futures had suffered a spectacular crash on COVID-19 fallout, the Saudi-Russia price war and oversupply.
Thus, the charge will likely be larger than the $15.8 billion net profit the firm earned last year.
Tuesday's announcement comes after rival BP revealed earlier this month that it was taking a hit of between $13 billion and $17.5 billion in the same period as a result of sustained coronavirus fallout that ravaged the world's appetite for oil.
"Given the impact of COVID-19 and the ongoing challenging commodity price environment, Shell continues to adapt to ensure the business remains resilient," Shell said in the statement.
It added: "In light of this, Shell is announcing today a revised long-term commodity prices and margin outlook, which is expected to result in non-cash impairments in the second-quarter results."
The move also reflected a planned reshaping of refining activities as it seeks to move