Shell anticipates weaker fourth-quarter 2024 earnings across its LNG, trading, and oil businesses, citing seasonal trends and lifting schedules. Despite strong gas division performance in Q3, the company expects a $1.3 billion Q4 charge related to emissions certificates and up to $1.2 billion in non-cash impairments in its renewables division. Lower natural gas production and LNG liquefaction volumes are also contributing factors.
Shell expects its LNG production and trading and oil trading businesses to book significantly lower results for the fourth quarter of 2024, due to seasonality and timing of lifting, the UK-based supermajor said on Wednesday. For the third quarter, Shell booked better-than-expected earnings on the back of strong performance in its gas division which offset weak refining margins in the downstream business.
Now previewing the fourth-quarter results, the international oil and gas firm expects to book on a group level a charge of $1.3 billion for Q4, related to the timing of payments of emissions certificates in relation to its fuel trading in Germany and U.S. biofuel programs. Shell will also recognize up to $1.2 billion in non-cash post-tax impairments in its renewables and energy solutions division, the company said in its update note ahead of the full fourth-quarter results which will be published on January 30. In the Integrated Gas division, Shell expects lower natural gas production in Q4 compared to the prior quarter, due to the scheduled maintenance at Pearl GTL in Qatar. LNG liquefaction volumes were also lower in the fourth quarter, due to lower feedgas and fewer cargos due to the timing of liftings. In the gas business, trading and optimization results are expected to be significantly lower compared to the third quarter, driven by the non-cash impact of expiring hedging contracts, Shell said. While the indicative refining margin was flat in Q4 compared to Q3, the chemicals margins for Shell declined in the fourth quarter and Shell expects the adjusted earnings in its Chemicals sub-segment to reflect a loss for the last quarter of 2024. Shell’s warning comes hours after U.S. supermajor ExxonMobil said it expects to book a weaker profit for the fourth quarter of 2024 because of lower refining margins, estimating the size of the negative impact at $1.75 billion
Shell Earnings Q4 LNG Oil Trading Seasonality Emissions Certificates Renewables Natural Gas Production Refining Margins
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