LONDON: Royal Dutch Shell said Thursday that a major recovery in oil prices enabled it to nearly triple profits in 2017.
The Anglo-Dutch energy giant said in a statement that net or bottom-line earnings soared to just under $13 billion last year from $4.6 billion in 2016, with fourth-quarter profits leaping 147 percent to $3.8 billion.
Shell said its performance was boosted particularly by rising oil prices, which tend to ramp up revenues and profits for energy majors.
World oil prices leapt by about 15 percent to finish the year at around $60 per barrel, aided by oil cartel OPEC's efforts to limit its collective production.
"Full-year earnings benefited mainly from higher realised oil, gas and liquefied natural gas (LNG) prices, improved refining performance and higher production from new fields, which offset the impact of field declines and divestments," the company said.
Profit adjusted for exceptional items and the changing value of oil and gas inventories surged to $12.1 billion in 2017, from $3.5 billion last time around.
Annual production stood at 3.66 million barrels of oil equivalent per day, which was broadly similar to 2016 as growth was offset by divestments.
Revenues soared by almost a third to $305 billion.
The company meanwhile boosted its cash flow in the wake of its 2016 purchase of BG Group.
"2017 was a year of strong financial performance for Shell," said chief executive Ben van Beurden.
Last year was "a year of transformation, in which we showed we have what it takes to deliver a world-class investment case," he said.
"Our relentless focus on value, performance and competitiveness meant we were able to deliver $39 billion of cash flow from operations excluding working capital movements from our upgraded portfolio.
"We strengthened our financial framework during the year through an $8 billion reduction in our net debt."
- Shares slide -
Investors, however, gave a muted response to the results, sending Shell's 'A' share price sliding 1.0 percent to 2,437 pence on London's rising stock market.
Nevertheless, analysts remain upbeat on the stock.
"In all, these are a bumper set of figures from the oil giant and, despite today's muted initial reaction to the results, the shares are on a good run, having risen 12 percent over the last year," said Interactive Investor's Richard Hunter.
"The company has reacted to lower historical oil prices by cutting through costs, a significant asset disposal programme and an ongoing reinvention of the business."
The energy sector weathered a prolonged oil price slump in recent years, with the market collapsing to just under $30 at the beginning of 2016.
However, prices soared close to three-year peaks earlier this month on the back of keen US demand and geopolitical jitters in key OPEC member Iran.
"With Brent Crude oil having reached $70 per barrel in early 2018 versus less than $30 two years ago, it is no surprise to find Royal Dutch Shell in a much stronger financial position."
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