Shell, the British energy giant, reported a 35% drop in first-quarter net profit to $4.8 billion in 2025, down from the previous year, due to declining oil prices.
The slump in crude prices stems from concerns over US President Donald Trump’s tariffs potentially slowing global economic growth and oil demand.
Despite the downturn, Shell exceeded analysts’ forecasts and announced $3.5 billion in shareholder buybacks for the next three months.
CEO Wael Sawan expressed confidence in the company’s resilience. Shell’s stock rose over 3% in morning trading on London’s FTSE 100. Analysts note Shell is well-positioned to handle low oil prices unless they fall below $60 for an extended period.
In 2024, Shell’s annual profit also fell 17% due to weaker oil prices, prompting the company to prioritize oil and gas over climate goals, including abandoning new offshore wind projects. Greenpeace UK criticized Shell, urging carbon polluters to fund climate resilience.
Meanwhile, rival BP reported a 70% profit plunge to $687 million, hit by weak gas sales and refining margins.
WHAT YOU SHOULD KNOW
Shell’s Q1 2025 results encapsulate the challenges facing the oil and gas industry: volatile commodity prices, macroeconomic uncertainty, and the push-pull between profitability and environmental responsibility.
While Shell’s outperformance and shareholder focus demonstrate resilience, its retreat from climate goals and exposure to oil price swings highlight vulnerabilities.
As Shell navigates 2025, its ability to adapt to economic, regulatory, and environmental shifts will determine its place in a rapidly evolving energy landscape.
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