We might be in the biggest recession since the 1930s, with thousands of people losing their jobs on a daily basis, but at least someone is still making money.
Yesterday, Shell announced it had made the biggest UK annual profit in history, despite suffering its biggest drop in quarterly profits in a decade.
Despite the tumble in oil prices that saw its 4-Quarter profits dive, Shell still benefitted from the record prices of last Summer when oil reached $147 a barrel. The oil giant made an annual profit of $31.4bn or £22.3bn. That equates to a cool $86 million a day or $3.6 million an hour.
Chief executive Jeroen van der Veer called the performance “satisfactory”, and warned that the global economic downturn was cutting demand for oil and gas. “Industry conditions remain challenging, and we are continuing the focus on capital and cost discipline in Shell,” said Van der Veer, who stands down this year.
But these could be interesting times ahead for Shell, which is seen as being more “vulnerable” than other oil majors because it has deliberately moved into the dirty tar and oil sands in Canada, which need an oil price of at least $70 to make real profits compared with today’s price of little over $40.
Even still, today’s profits will keep Shell ahead of rival BP. However, if the oil price stays low for a year or so, Shell won’t be reporting record profits. But by that time van der Veer will be on the golf course, with a pension beyond most peoples’ wildest dreams.