Shell’s woes send FTSE tumbling

Investors in oil giant Shell sent the FTSE 100 tumbling yesterday as London’s top index lagged far behind many of its global counterparts.

The oil company’s share price suffered a sharp fall after it announced plans to slash up to $22 billion (£18 billion) from the value it gives its assets.

It was an acknowledgement from Shell’s management that the oil in the ground that it has the rights to extract may not be worth as much as previously estimated.

The news sent both A and B shares in Shell – both of which are listed on the FTSE 100 – down by nearly 4%.

At the end of the day, the FTSE had dropped 0.9%, or a 56.03 point loss to 6,169.74.

The news that the UK’S GDP fell faster than first thought in the first three months of the year and a lockdown in Leicester are also likely to have weighed on the index, said Connor Campbell, at Spreadex.

It contrasted the FTSE against more bullish moves from the continent and the US.

In Frankfurt, the Dax rose 0.6%, in Paris the Cac 40 index dropped 0.2%, and in New York the Dow Jones and S&P 500 were trading up by 0.3% and 1% shortly after markets closed in Europe.

The price of oil also likely weighed on Shell and BP, with Brent crude dropping 1.2% to 41.20 US dollars per barrel.

The pound traded up about 0.6% against both the dollar and the euro, buying 1.2373 and 1.1003 respectively.

The biggest fallers on the FTSE 100 were Shell ‘A’, down 52.8p to 1,287p, Shell ‘B’, down 46.8p to 1,224p and IAG, down 8.4p to 222.2p.