Shell upgrades oil and gas assets amid demand for refining profits

Shell said that surging demand for oil products that had almost tripled refining profits in the second quarter would boost earnings by up to $1.2 billion.

The increased refining margin is expected to boost the division’s earnings by $800 million to $1.2 billion in the second quarter compared with the first quarter.

The upgrade will result in post-tax impairment reversals of $3.5 billion to $4.5 billion. Shell wrote down more than $22 billion in 2020 when the pandemic led to an oil price collapse.

Shell also said it would reverse up to $4.5 billion in writedowns on oil and gas assets after it raised its energy prices outlook following Russia’s invasion of Ukraine.

Earnings from oil and refined products trading were expected to be strong in the quarter but lower than the first quarter of 2022, Shell said.